SEC Chair Paul Atkins Charts New Course, Signaling Major Crypto Regulatory Shift and Potential ICO Revival

The newly seated U.S. Securities and Exchange Commission (SEC) Chair, Paul Atkins, has signaled that the coming year could reshape the crypto policy landscape, marking a clear departure from the enforcement-first stance of his predecessor, Gary Gensler. Speaking at the Blockchain Association Policy Summit in Washington, Atkins used an agricultural metaphor, indicating the SEC has been "planting seeds" for future regulatory changes that are now beginning to grow and will soon yield tangible results for the public.

Atkins' early agenda focuses on establishing a regulatory architecture that encourages innovation rather than suppressing it. Key initiatives include crafting a new classification system for digital assets, updating outdated securities rules to reflect blockchain technology, and creating streamlined pathways for new token-based products. One of the first policy tools expected is a conditional "innovation exemption"—a safe zone allowing crypto startups to test products without immediate full compliance obligations—which may be released before the end of January 2026.

This shift is underpinned by a major reinterpretation of securities law. Through the SEC's "Project Crypto" initiative, Atkins has proposed a token taxonomy that narrows the scope of what constitutes a security. He argues that an asset should only be treated as a security when its value depends on the explicit managerial efforts of others, a refined application of the Howey Test. Under this framework, network tokens, digital collectibles (NFTs), and digital tools would not be considered securities and would instead fall under the jurisdiction of the Commodity Futures Trading Commission (CFTC). Only tokenized securities offerings would remain under strict SEC oversight.

This stance could potentially revive Initial Coin Offering (ICO)-style fundraising in the U.S., a market largely dormant since 2018, by allowing many token sales to proceed under CFTC oversight rather than the SEC's stringent registration requirements. Major industry players like Coinbase are already positioning for this shift. However, Atkins' ambitions are not unilateral; they partly depend on cooperation from Congress, which is still slowly negotiating a wide-ranging crypto bill to determine the division of oversight between the SEC and CFTC.