SEC Chair Paul Atkins's remarks on tokenization at the Cryptocurrency Task Force roundtable meeting:
"The topic of discussion this afternoon is very timely, as securities are gradually transitioning from traditional ('offline') databases to blockchain-based ('online') ledger systems.
The process of migrating securities from off-chain systems to on-chain systems is similar to the transformation audio recordings underwent decades ago: from vinyl records to tapes, ultimately entering the digital software era. This change reflects the trend of technological development and the pursuit of more efficient trading methods.
Just as the widespread adoption of digital audio has fundamentally changed the music industry, the introduction of on-chain securities has the potential to profoundly transform various aspects of the securities market through innovative methods of issuance, trading, holding, and using securities.
In order to make the U.S. the 'global cryptocurrency hub' as envisioned by President Trump, the committee needs to keep pace with technological innovation and consider whether regulatory adjustments are necessary to accommodate the development of on-chain securities and other cryptocurrency assets.
A significant focus of the chair is to establish a reasonable regulatory framework for the cryptocurrency market. This will include developing clear rules to regulate the issuance, custody, and trading of cryptocurrency assets while continuing to rigorously combat illegal activities.
The U.S. Securities and Exchange Commission (SEC) has opened a new chapter. Moving forward, policy-making will no longer be determined through temporary enforcement measures. Instead, the committee will utilize existing rule-making, interpretations, and exemptions to set appropriate standards for market participants.
This work requires coordination and collaboration among multiple offices and departments within the committee, so it is gratifying that committee members Uyeda and Peirce have jointly established the Cryptocurrency Task Force.
The committee has long faced the issue of policy-making silos. The Cryptocurrency Task Force demonstrates how policy departments can work together to quickly provide the American public with much-needed clarity and certainty.
Currently, there are three key areas of cryptocurrency asset policy—issuance, custody, and trading. Firstly, it is expected that the committee will develop clear and reasonable guidelines to regulate the distribution of cryptocurrency assets that are considered securities or are subject to investment contracts.
Currently, only four cryptocurrency asset issuers have registered issuances under Rule A. Most of these issuers have opted to avoid such issuances mainly due to the many challenges in meeting the relevant disclosure requirements.
The committee's staff recently released a statement clarifying certain disclosure obligations for registration and issuance. The statement also explicitly mentions that certain distributions and cryptocurrency assets are not subject to federal securities laws.
Secondly, there is support for allowing registrants to have more choices in the custody of cryptocurrency assets.
It's crucial to clarify which types of custodians meet the 'qualified custodian' standards under the Advisers Act and the Investment Company Act. At the same time, reasonable exceptions need to be proposed to accommodate certain practices in the cryptocurrency market.
Thirdly, allowing registrants to trade a broader range of products on their platforms and engage in related activities based on market demand, which had previously been prohibited in earlier committees, is worth supporting.
For instance, some brokerage firms wish to launch a 'super app' that integrates trading functions for both securities and non-securities, along with other financial services, allowing users to complete all operations on one platform. This desire aims to provide a more convenient one-stop financial service experience.
Staff have been asked to help come up with some ways to modernize the regulatory framework for ATS (Alternative Trading Systems) to better accommodate cryptocurrency assets. At the same time, discussions are ongoing about whether more guidance or rules are needed to support the listing and trading of cryptocurrency assets on national securities exchanges.
I hope to work together with President Trump’s administration and colleagues in Congress to make the U.S. the best place to participate in the global cryptocurrency market.
-- Original text from SEC official Twitter