U.S. Securities and Exchange Commission (SEC) Chairman Paul Atkins has been pushing the Commission to adopt these new rules. In particular, he seeks to exclude decentralized finance (DeFi) platforms from certain regulatory impediments. Atkins has directed SEC staff to look into creating some sort of “innovation exemption.” It would allow entities currently under SEC jurisdiction to be able to more quickly launch safe and sound on-chain products and services. This joint initiative seeks to promote responsible innovation through the DeFi sector while recognizing the importance of regulatory compliance when applicable and appropriate.
As the only Republican on the commission, Atkins serves in a unique 3-1 Republican majority. He and other Republican members of the SEC believe that software developers creating DeFi tools should not be held responsible for how those tools are ultimately used.
Atkins has been wandering around the ecosystem, trying to clear the brush and make a path for developers in the DeFi space. He also recently hosted a roundtable with the DeFi community leaders to discuss ideas for policy and legislative reforms. This roundtable was the fifth and final crypto roundtable convened by the agency during Atkins’ tenure.
"We should not automatically fear the future." - Chairman Paul Atkins
Atkins argues that exempting DeFi platforms from regulatory barriers would be a transformational move for the United States. This simple but consequential move would unlock a wave of innovation and economic growth from the financial technology sector. He has long raised alarms that EPA’s overreach would squash new development and push technological innovation abroad.
In addition to Commissioner Hester Peirce, other prominent people have spoken out on the SEC’s attempts to regulate code.
"The SEC must not infringe on First Amendment rights by regulating someone who merely published code on the basis that others use that code to carry out activity that the SEC has traditionally regulated." - Commissioner Hester Peirce
Crypto entrepreneur Erik Voorhees, an early and vocal supporter of the crypto space, recognized the importance of this possible change in attitude from the SEC.
"I appreciate the change of tone and the change of stance for the commission." - Erik Voorhees
Atkins has an impressive and diverse background in journalism. He won national awards for his extraordinary feature writing from the frontlines of Iraq as a war correspondent and later as a police reporter for several metropolitan daily newspapers. We hope that this experience will lead to a stronger appreciation for the need to balance innovation with responsible oversight.
"Many entrepreneurs are developing software applications that are designed to function without administration by any operator." - Chairman Paul Atkins
