- The Securities and Exchange Commission (SEC) is preparing an “innovation exemption” for digital asset developers in the United States.
- SEC Chair Paul Atkins said the exemption could be formalized by the end of 2025 or early 2026, depending on the duration of the current government shutdown.
- Rulemaking is a top priority for Atkins, aiming to shift away from “regulation-by-enforcement” in cryptocurrency oversight.
- The first major U.S. crypto bill, the GENIUS Act, has prompted the Treasury Department to propose new rules for stablecoins.
- Industry experts see growth in stablecoin use and continuing uncertainty about potential U.S. market structure legislation passing this year.
The Securities and Exchange Commission (SEC) is working to establish an “innovation exemption” that would let companies build projects involving digital assets and new technologies in the United States. SEC Chair Paul Atkins stated the agency is prioritizing this exemption and intends to have it in place by late 2025 or during the first quarter of 2026, depending on how long the ongoing government shutdown continues.
Atkins said the shutdown has delayed the SEC’s ability to work on new rules but reaffirmed that the agency’s main goal is to help innovators stay in the country. He described the innovation exemption as something he hopes to have “squared away” soon and emphasized that this move is meant to encourage entrepreneurs who might otherwise relocate their operations abroad.
Speaking at a Katten Muchin Rosenman LLP event, Atkins said that crypto regulation is now the SEC’s “job one.” He criticized the last four years of policies that he said have held back the crypto industry in the U.S., adding “with the result of pushing things abroad, rather than having innovation being done [here].” Atkins also said that shifting to formal rulemaking would move the agency past strategies like regulation-by-enforcement and informal staff guidance.
Panelists discussed legislative progress, including the GENIUS Act, which focuses on stablecoins—digital currencies pegged to a stable value like the U.S. dollar. The Treasury Department recently released proposed rules for stablecoins as a result of this act. Greg Xethalis from Multicoin Capital said these Treasury rules could trigger a surge in new day-to-day applications for stablecoins. He pointed to USA.VISA.com/”>Visa’s integration of USD Coin (USDC) as an example of how traditional finance is beginning to use crypto technology.
Summer Mersinger of the Blockchain Association and other experts discussed the outlook for a broader crypto market structure bill. Mersinger estimated near-even odds it would pass this year, while others said it was less likely. Still, panelists agreed that stablecoin use could grow, especially for fund transfers and financial contracts.
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