SEC Chair Says US Must Close the Gap With Other Countries on Crypto Regulation

“We want to make sure to build a strong framework [for crypto] to actually attract people back into the United States,” he said, adding “but also to build a framework for the future so that innovation can thrive.”

He called tokenization of assets a necessary step to unlock innovation in financial markets. “We have this technology, distributed ledger technology, that to me is the most exciting part of this, more than the coins themselves,” he said. “Putting things on-chain I think has tremendous potential for financial markets, for de-risking…for transparency, it solves a lot of compliance issues, and it just makes it more democratized and accessible for various products to be tokenized.”

In addition to new, pro-innovation regulations, Atkins also addressed the need for innovation within the operation of the regulatory agencies themselves.

“There are many different agencies that are concerned about crypto, but why should you have to go to register at multiple agencies when we’re all focused on the same goal?” he asked. “Why can we have mutual recognition among them?”

He floated the concept of a “super app” that would allow for a single registration that would reify across all relevant agencies. “Thinking about regulatory coordination as an app in itself is clever,” he said.

Related: EU Faces New Calls from France for Unified Crypto Regulation

The chairman also reiterated his proposal to create an “innovation exemption” that would allow crypto firms to launch products faster without going through the full securities regulatory process. He added that the SEC already has then authority to grant exemptions and is committed to using it.  “We can be very forward-leaning in order to accommodate new ideas,” he said.

Atkins’ current position as chairman is his third stint with the SEC. He began as a staffer in the chairman’s office in the 1990s, then served as a commissioner on the aughts. He agreed to return as chairman, he said, in part because he saw it as an opportunity to help usher in an era of crypto-based financial markets.

“I’d like to say that we’re the Securities and Innovation Commission,” he quipped.

He also saw the chairmanship as an opportunity to break from previous SEC regimes he believed were either indifferent or hostile toward crypto.

“The agency had had two iterations” around technological innovation in general and crypto in particular, he said. “The first was the ostrich head-in-the-sand approach of hoping it would all just go away, the second was regulation through enforcement. We’re not doing either of those.”