šļø SECās Crypto Task Force Roundtable: Charting the Path Forward
Earlier this month, the SEC concluded its high-profile āCrypto Task Forceā roundtables, culminating in a session titled āDeFi and the American Spiritā. The discussions centered on tokenization, decentralized finance (DeFi), and the foundational areas of issuance, custody, and trading for crypto assets. Hereās a breakdown of what was saidāand what matters:
1. Crypto Is Not a Single Monolith
Commissioner Caroline Crenshaw opened the floor by emphasizing diversity within the crypto universeāfrom self-custody developers to platform operators. These roundtables revealed competing visions on how, and whether, various actors should register with the SEC .
2. Tokenization: What Are We Actually Building?
During the May 12 session on tokenization, Crenshaw famously asked:
> āWhat exactly are we trying to build?ā
She warned that ātokenizationā is often oversimplifiedāare we talking about issuing tokens on-chain, or embedding securities lifecycle activities in traditional settlement systems? Definitional clarity is key before crafting any further rules.
Commissioner Mark Uyeda urged proactive inclusion of tokenization in policy, highlighting its potential to boost liquidity and streamline operations via smart contracts .
3. DeFi: The American Spirit Meets Market Risk
On June 9, Chair Paul Atkins led the āDeFi and the American Spiritā session, asserting that blockchain-powered systems promote economic freedom and genuine ownershipābut also challenged the SEC to formalize rules around issuance, custody, and trading. He emphasized that while administrative flexibility is essential, regulatory certainty canāt rely solely on enforcement memos .
4. Modernizing Custody Requirements
Custody was a hot-button issueāwith voices across the roundtables calling for:
Technology-neutral, principles-based frameworks that evolve with advances in custody solutions .
A shift in focus from āwhere are the private keys?ā to outcome-based measures, like transparency and auditability .
Inclusion of state-chartered trust companies and possible adjustments to rules around qualified custodians .
Crenshaw cautioned against creating a two-tiered system unless both traditional and digital custody methods provide equivalent investor protections .
5. A Pro-Engagement Stance from New Leadership
Securing the session was Paul's broader policy vision, outlined in both the tokenization and DeFi panels:
The SEC is stepping away from āregulation by enforcementā toward fit-for-purpose rules.
The Commission is now supportive of self-custody, staking activities, and technology-enabled approachesāso long as they meet investor protection standards .
Atkins emphasized that U.S. leadership in crypto is contingent on cultivating a clear, flexible, and technology-responsive regulatory regime .
š What This All Means
Key Area What Was Said Whatās Next
Definitions Terms like ātokenizationā and āDeFiā are being scrutinized, not accepted as intuitive. Expect formal clarifications or definitions via rulemaking.
Custody A shift to outcome-based and tech-neutral custody rules, not just key storage rules. SEC may propose alternatives to the āqualified custodianā model.
Registration & Jurisdiction Both registered and unregistered entities debated over regulatory obligations. Rule proposals to delineate who must register, and under which criteria.
Rulemaking over Enforcement Chair Atkins emphasized the need to ādo it right, not just fast.ā Watch for formal rule proposals, likely accompanied by public comment periods.
š§ The Takeaway
The SECās roundtable series marks a critical shiftāfrom informal enforcement to a structured regulatory roadmap for crypto. Regulators acknowledge the innovation potential in DeFi, tokenization, and self-custody. But they are clear-eyed in demanding investor protection, transparency, and definitional clarity. With Chair Atkins at the helm, expect the SEC to move toward
formal rulemakingāmarking the next phase of crypto regulation in Washington.