SEC’s 90-day crypto reform plan under Trump

The crypto industry’s hopes for improved SEC relations under Paul Atkins received a major boost with the introduction of a 90-day plan focusing on clearer regulations, halting unnecessary litigation, and removing outdated rules. The proposal is expected to rebuild trust and encourage innovation. The next three months will be critical for shaping a more balanced regulatory approach under Trump. 

Recognized as a pro-crypto advocate, the Paul Atkins-led SEC could signal potential regulatory changes and improve crypto relations under the Trump administration. This shift could lead to clearer and more supportive regulations for the crypto industry.

In a December 18 statement, the Digital Chamber said, “The digital asset industry is striving to operate responsibly, and the SEC must recognize this to foster a productive and transparent ecosystem.” The group emphasized the need for mutual trust.

The SEC has been criticized for “regulating through enforcement”, which has caused much confusion and slowed down innovations. The Digital Chamber’s Token Alliance is calling for a change by urging the SEC to build trust with the crypto industry.

It believes this can happen if the SEC recognizes that most crypto participants act responsibly. it also maintains that a more transparent approach would help both sides move forward.

The 90-day crypto plan

The Token Alliance has proposed a 90-day plan to change the way how SEC handles cryptocurrency regulations. One key suggestion is to immediately review all current crypto-related investigations, Wells notices, and lawsuits.

The plan also calls for pausing litigation in cases that don’t involve fraud, investor harm, or immediate risk. This includes major cases involving companies like Binance, Coinbase, and Ripple, which have caused inconveniences between the SEC and the crypto industry on a regular basis.

The goal is to create a more balanced approach and avoid obstructing innovation. This reset’s goal is especially to build trust and clear up confusion in the digital asset space.

The Alliance suggests removing outdated rules that have caused confusion, including the 2019 framework applying the Howey test to digital assets and the 2018 “Hinman Speech.”

The group also wants to stop regulating the industry through enforcement actions. Instead, it urges the SEC to create clear and consistent rules to help businesses. These changes are necessary to clear up confusion, make the market fairer, rebuild trust in investors, and encourage innovation in the crypto world.

Another priority is to deal with the burden of Staff Accounting Bulletin 121 (SAB 121), which forces companies holding cryptocurrencies to list them as liabilities.

The Token Alliance argues that this rule pushes investors away from the U.S. market and to the riskier options abroad. Although President Biden rejected a bill to repeal SAB 121, may be the new administration could reverse this decision and provide relief.

It also mentioned reconsidering the SEC’s plan to expand “exchanges” to cover decentralized finance (DeFi) platforms under Rule 3b-16. Critics argue that this could limit innovation in the DeFi space and reduce its benefits.

SEC’s new era 

Paul Atkins is expected to take a different approach from the outgoing Gary Gensler. Atkins will likely work closely with Commissioners Hester Peirce and Mark Uyeda, who have criticized the current regime’s policies on digital assets. Together, they could guide the SEC toward a fairer and clearer regulatory system.

The Token Alliance’s recent talks with Commissioners Peirce and Uyeda have been positive. Both commissioners showed interest in engaging with the crypto industry. Crypto supporters see this as a good sign for future discussions and collaboration.

The next 90 days will reveal if the SEC can build trust with the crypto industry and adopt a more balanced approach.

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