Washington, D.C. — Paul Atkins, Chair of the U.S. Securities and Exchange Commission (SEC), unveiled the next phase of Project Crypto, aimed at establishing a clear and fair regulatory framework for digital assets. Speaking publicly, Atkins emphasized the importance of balancing innovation with investor protection while aligning U.S. cryptocurrency policy with economic realities.
Project Crypto, which launched in August 2025, focuses on creating standards for token classification and market clarity. Atkins highlighted that most digital tokens circulating today are not inherently securities, though some may be sold as part of investment contracts. He criticized the current approach that treats any token once classified as a security as permanently regulated, calling it “counterproductive” and a potential driver of innovation moving abroad.
Atkins proposed a token taxonomy based on the Howey test, clarifying which tokens qualify as investment contracts. He outlined three main categories for crypto assets:
- Digital goods or network tokens
- Digital collectibles
- Digital instruments
Only tokenized securities would remain under SEC jurisdiction. Atkins also discussed developing an adapted offering regime to support capital formation for smaller projects, enabling innovation while protecting investors.
The SEC plans to issue formal rules for the crypto market by the end of 2025 or early 2026. Atkins stressed the importance of collaboration with Congress, the Commodity Futures Trading Commission (CFTC), and banking regulators to create a coherent legal framework for non-security crypto assets.
“At Project Crypto, economic reality outweighs labels. Not every token or NFT is a security simply because it’s called one,” Atkins stated. “Our goal is not to expand SEC jurisdiction unnecessarily, but to ensure capital can form, investors are protected, and innovation thrives in the U.S.”
Atkins, who assumed his SEC role in April 2025, framed the initiative as a commitment to integrity, clarity, and the rule of law, underscoring that each token represents not just technology but people, innovators, investors, and citizens striving for growth.
