Bitcoin News Today: SEC Launches Crypto Overhaul to Boost Institutional Adoption and Market Stability

The U.S. Securities and Exchange Commission (SEC) has unveiled a significant overhaul of its regulatory approach to cryptocurrency markets, known as "Project Crypto," under the leadership of SEC Chair Paul S. Atkins. The initiative aims to modernize the regulatory environment for digital assets, with a focus on strengthening crypto custody frameworks and integrating trading systems with traditional finance. This marks a strategic departure from the SEC’s historically enforcement-focused stance toward a more structured and innovation-friendly framework [1].

A key aspect of the reforms involves revising crypto custody rules to support the development of secure, scalable custody solutions for institutional investors. The SEC is also examining mechanisms to enable parallel trading of crypto and non-crypto securities, which could streamline operations and reduce costs for market participants [1]. These changes are expected to drive greater institutional participation in the crypto space, potentially boosting liquidity and market stability across digital asset platforms.

In a related development, the SEC has approved in-kind redemptions for crypto ETFs, allowing institutional investors to receive crypto assets directly instead of cash. This development is expected to enhance operational efficiency and reduce transaction costs for major players such as BlackRock and Fidelity [2]. The Chicago Board Options Exchange (CBOE) has also proposed a unified framework for crypto ETFs, calling for the SEC and Commodity Futures Trading Commission (CFTC) to provide clear federal guidelines on custody, trading, and registration [3].

The White House has further contributed to the evolving regulatory landscape with a 166-page report that underscores the need for federal-level trading of digital assets and recommends assigning clear regulatory authority to the CFTC over non-security digital assets. While the report did not provide specifics on the Strategic Bitcoin Reserve or U.S. Digital Asset Stockpile—subjects mentioned in a prior executive order—it emphasized the importance of avoiding policies that could stifle innovation [5]. It also highlighted the necessity of addressing illicit finance, including the regulation of coin mixers and the enforcement of anti-money laundering laws [5].

In the market, crypto firms are adopting financial strategies commonly used in traditional finance. For example, Twenty One Capital is exploring the possibility of lending U.S. dollars against Bitcoin as collateral, a practice mirroring Wall Street’s repo market [4]. These moves reflect a growing convergence between traditional financial institutions and the crypto market. As regulatory frameworks continue to evolve, the potential for broader adoption and integration of digital assets into mainstream finance is becoming increasingly evident.

Bitcoin has maintained a price above $118,526 as of July 31, 2025, with a market cap of $2.36 trillion [1]. Analysts suggest that the regulatory changes may lead to increased institutional engagement and further development in decentralized finance and tokenization sectors [1]. The SEC’s reforms signal a broader effort to position the United States as a global leader in the digital finance revolution [6].

Sources:

[1] https://ng.investing.com/news/cryptocurrency-news/sec-chairman-unveils-project-crypto-to-make-us-a-global-leader-93CH-2037498

[2] https://my-cpe.com/insights/regulatory-updates/sec-updates/sec-gives-green-light-to-in-kind-crypto-etf-redemptions

[3] https://www.binance.com/en/square/post/07-30-2025-cboe-seeks-sec-approval-for-unified-crypto-etf-framework-27657330950257

[4] https://www.bloomberg.com/news/articles/2025-07-30/crypto-firms-adopt-wall-street-s-financial-tactics-in-new-era

[5] https://www.globalcompliancenews.com/2025/07/30/https-insightplus-bakermckenzie-com-bm-technology-media-telecommunications_1-united-states-the-genius-act-a-new-federal-framework-for-stablecoin-issuers-custodians-and-banks_07252025/

[6] https://www.sec.gov/newsroom/speeches-statements/atkins-digital-finance-revolution-073125