SEC Launches Project Crypto to Modernize Crypto Regulations and Promote Innovation

The U.S. Securities and Exchange Commission (SEC) has launched “Project Crypto,” a sweeping initiative aimed at modernizing U.S. securities regulations to support the growth of the cryptocurrency and blockchain industry. Announced by SEC Chair Paul Atkins, the program is designed to position the U.S. as the global leader in digital finance, aligning with President Trump’s vision of making the country the “crypto capital of the world.” The initiative responds to regulatory uncertainty that has historically driven innovation to other jurisdictions and seeks to create a clearer, more flexible legal framework for digital assets [1].

A central focus of Project Crypto is to clarify the regulatory status of crypto assets, with Atkins stating that most are not securities. The SEC aims to develop new tests to help determine whether a particular asset qualifies as a security, reducing ambiguity that has hindered industry development. The initiative also plans to modernize custody rules for digital assets, including those held by registered intermediaries, to give investors more control over their holdings [2].

Promoting self-custody—where individuals hold and manage their own crypto assets in personal wallets—is a core component of the initiative. Atkins emphasized this as a fundamental American right, essential for on-chain activities like staking. The SEC also plans to update rules that restrict the use of on-chain systems in capital markets, including decentralized finance (DeFi), to allow for both intermediated and non-intermediated models [3].

Project Crypto includes support for the development of “super apps,” platforms that integrate a wide range of financial services and products under a single interface and regulatory license. This approach is intended to reduce compliance burdens and encourage innovation in the digital asset space. The initiative is being coordinated across multiple SEC divisions and involves the newly established Crypto Task Force, led by Commissioner Hester Peirce, to ensure that outdated regulations do not impede progress [4].

The initiative also aims to bring traditional securities onto blockchain networks by rewriting rules that currently prevent tokenized and non-tokenized assets from being traded on-chain. This is expected to enhance efficiency, transparency, and accessibility in financial markets. The launch of Project Crypto follows the recent passage of the GENIUS Act, which has laid the groundwork for more technology-friendly financial reforms [5].

The move represents a significant shift in the SEC’s approach to crypto regulation. While previous administrations under Gary Gensler took a more cautious stance, the current leadership under Paul Atkins is focused on fostering innovation while maintaining investor protection. By embracing blockchain technology and updating outdated rules, the SEC aims to ensure that U.S. markets remain competitive in the global digital economy [6].

Sources:

[1] American Leadership in the Digital Finance Revolution (https://www.sec.gov/newsroom/speeches-statements/atkins-digital-finance-revolution-073125)

[2] SEC debuts 'Project Crypto' to bring U.S. financial markets '... (https://www.cnbc.com/2025/07/31/sec-debuts-project-crypto-to-bring-us-financial-markets-on-chain.html)

[3] SEC Unveils Project Crypto to Make U.S. Global ... (https://www.ainvest.com/news/sec-unveils-project-crypto-global-crypto-capital-2508/)

[4] US securities regulator lays out sweeping plans to ... (https://www.reuters.com/sustainability/boards-policy-regulation/us-securities-regulator-lays-out-sweeping-plans-accommodate-crypto-2025-07-31/)

[5] Paul Atkins Launches Project Crypto: SEC's Ambitious ... (https://www.ccn.com/news/crypto/paul-atkins-project-crypto-sec-rewrite-rulebook/)

[6] SEC Launches 'Project Crypto' to Modernize Securities Rules (https://www.pymnts.com/cryptocurrency/2025/sec-launches-project-crypto-modernize-securities-rules-regulations/)