Atkins Delivers Remarks on Digital Assets Approach
In November, Securities and Exchange Commission (SEC) Chair Paul Atkins delivered remarks at the Federal Reserve Bank of Philadelphia on the Commission’s approach to digital assets. Deemed “Project Crypto,” the Commission staff are currently working to build out a regulatory framework for digital assets, including the application of the federal securities laws to crypto assets and related transactions. In his speech, Chair Atkins noted that “a stock is still a stock whether it is a paper certificate, an entry in a DTCC account, or represented by a token on a public blockchain.” He added that “[s]ecurities, however represented, remain securities.”
In addition, Chair Atkins detailed four beliefs that work as a base for the development of a “token taxonomy.”
- Digital commodities are not securities
- Digital collectibles are not securities
- Digital tools (ex. a membership, ticket, credential, title instrument, or identity badge) are not securities
- Tokenized securities are, and will continue to be, securities
He noted that he has instructed Commission staff to “prepare recommendations for the Commission’s consideration that facilitate capital formation and accommodate innovation while, at the same time, ensuring investors are protected.” He believes the Commission can use exemptive authority as well as rulemaking authority to move forward with the aspirations of Project Crypto. He also called on Congress to continue its efforts to codify a market structure framework. He added that allowing innovation to thrive does not mean the Commission will turn its back to fraud and illicit conduct.
Click here to read Chair Atkins remarks on Project Crypto.