U.S. Securities and Exchange Commission (SEC) Chairman Paul Atkins and Commissioner Hester Peirce have made it clear that the regulatory agenda will not be shaped by price movements, despite the recent decline in cryptocurrency markets. Speaking at the ETHDenver conference, the two emphasized the need to clarify the position of tokenized securities within existing federal laws.
The decline of over 28% for Bitcoin and nearly 40% for Ethereum in the last 30 days has put pressure on the market. Bitcoin fell to around $66,000, while Ethereum tested below $2,000. XRP also saw a drop of approximately 5%. Despite this, Atkins stated that it is not appropriate for regulators to react to daily price fluctuations.
“The most appropriate step is for the rules regarding the asset classes we regulate to provide investors with the information they need,” Atkins said, adding that investors should be able to make buy, sell, or hold decisions based on sound data. According to him, the regulator's job is not to concern itself with the direction of prices; To provide a transparent and predictable framework.
A message of clarity for tokenized securities
Atkins and Peirce argued that clearer rules are needed on how tokenized securities will be integrated into existing securities laws. They stated that this clarity would provide greater legal confidence to both developers and investors.
It was noteworthy that the SEC did not directly address the market structure bill being discussed in Congress. However, Peirce stated that the institution provided technical support. The bill, which passed the House of Representatives in July and is proceeding in the Senate under the name "CLARITY Act," could shift a significant portion of the authority over digital assets to the Commodity Futures Commission (CFTC).
At this point, the institutional structure of the CFTC is also a subject of debate. Michael Selig, who was confirmed as chairman and commissioner in December, is currently the only member of the commission, which should have five members. Some lawmakers in the Senate are focusing on provisions that require the confirmation of at least four commissioners for the market structure law to go into effect.
“Don’t panic just because the price is falling”
Speaking at ETHDenver on February 18, Atkins said regulators should not get caught up in calls for immediate intervention against market downturns. “Those who focus only on the price constantly rising may be disappointed,” Atkins said, noting that daily volatility is outside the institution’s core mission.
The SEC Chairman also stated that the institution has recently adopted a more structured approach. As part of the work called “Project Crypto,” conducted in collaboration with the CFTC, frameworks for classifying crypto assets, rules for tokenized securities traded on automated market makers, and guidelines for the custody of non-security assets are being worked on.
Atkins reminded that the SEC has moved away from its “regulation through sanctions” approach, which has been heavily criticized in the past; numerous crypto cases have been dropped, and staff guidelines for mining, staking, and meme coins have been published.
Innovation exemption on the agenda
One of the prominent topics in the speech was the “innovation exemption.” Atkins announced plans for a temporary exemption that would allow tokenized securities to be traded with limited volume on decentralized platforms. This exception aims to provide market participants with a controlled testing ground while permanent rules are being established. Hester Peirce, on the other hand, viewed the current downturn as an opportunity for developers. Addressing the "Schadenfreude" of complacency among some regarding the decline in the crypto market, Peirce stated that regulatory clarity alone would not generate value. She emphasized that the real determining factor is the development of products that users truly need.
