SEC Chair Paul Atkins Unveils New Crypto Rulebook and Proxy Reforms
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SEC Chair Paul Atkins has announced two major reforms that he says will bring more clarity and fairness to today’s financial system. One focuses on finally giving crypto a simple, modern rulebook, while the other aims to reduce the growing influence of proxy advisory firms that shape how major companies make decisions.
According to Atkins, both sectors have been operating under outdated rules and now require a reset that reflects how markets work today.
A New, Simpler Rulebook for Crypto: What It Means
Atkins says the biggest challenge in crypto has been the lack of clear regulations. Digital assets have long been forced into old securities laws designed for the paper era, leaving both investors and developers uncertain about what counts as a security. To address this, the SEC has launched Project Crypto, a framework built on a straightforward idea: tokens can evolve.
A token may start as a security when a project raises funds, but once the network matures, the code is finished, and no single team controls it, the token may no longer be treated as a security. This approach gives projects room to grow without constant legal uncertainty.
Under Project Crypto, digital assets fall into four clear categories: network tokens, collectibles, digital tools, and tokenized securities. Only tokenized securities will remain under strict SEC oversight. Atkins also emphasized that fraud will continue to be punished and that tokenized financial products will still be regulated heavily.
Crypto companies, including Shyft Network, say this marks a major shift from the previous approach, which treated nearly all tokens as securities. Instead of regulating through lawsuits, the SEC is finally offering clear categories that reflect how the technology actually works. This could allow some tokens to trade on CFTC- or state-regulated platforms and help multi-service crypto apps obtain proper licensing.
The SEC is still recovering from the recent 43-day government shutdown, which forced some companies to use older 20-day rules to go public. Atkins expects these temporary measures to continue for now but says the new crypto framework will restore stability.
Reining In the Power of Proxy Giants
Atkins is also targeting proxy advisory firms, which guide institutional investors on how to vote on issues such as executive pay and board decisions. He argues that some proposals pushed through these firms increasingly reflect political goals rather than business priorities. The SEC plans to revive earlier reforms and introduce stricter standards to ensure that voting advice is transparent and fair.
Large index fund managers like BlackRock and Vanguard will also face tighter oversight, as they influence corporate decision-making despite appearing to take a passive role.
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FAQs
Project Crypto is a new regulatory plan that could shift crypto oversight from the SEC to the CFTC for more balanced digital asset regulation.
Project Crypto creates four token categories and lets some tokens shift out of security status as networks mature.
Tokens can evolve: early-stage tokens may be securities, but decentralized, finished networks may no longer be regulated as such.
The SEC plans tighter standards to ensure proxy voting advice is transparent, reliable, and focused on business—not politics.
Firms like BlackRock and Vanguard will face closer scrutiny due to their growing influence on corporate voting decisions.
