US SEC Chair Previews: "Tokenized Securities Innovation Exemption" Coming Soon, Criticizes Excessive Regulatory Intervention in Business

SEC Chair Paul Atkins delivered an important speech at the Investor Advisory Committee (IAC) meeting on March 12 Taipei time. He not only reaffirmed the concept of “minimum effective regulation” to reduce corporate compliance burdens but also explicitly previewed that the SEC will soon consider an innovative exemption framework for “Tokenized Securities,” paving the way for the integration of crypto assets and traditional finance.
(Background: U.S. CFTC Chair announces “New Blueprint for Crypto Regulation”: jointly launching Project Crypto with SEC, bringing clear rules to DeFi and prediction markets)
(Additional context: U.S. CFTC Chair Selig emphasizes focus: opening up crypto perpetual contracts in weeks, ending turf battles with SEC)

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• Opposing “Shaming Regulation,” pursuing the minimum effective dose
• Previewing “Innovation Exemption” to greenlight tokenized securities
• Crypto Task Force actively advancing, gathering public input

The regulatory landscape for U.S. cryptocurrency and traditional financial markets is approaching a critical turning point. On March 12, the new SEC Chair Paul Atkins attended the first IAC meeting of the year and delivered a highly anticipated opening speech.

In his remarks, Atkins not only addressed reforms to traditional corporate disclosure burdens but also showed a constructive openness toward digital assets, especially tokenized securities.

Opposing “Shaming Regulation,” pursuing the minimum effective dose

Atkins first targeted the rapidly increasing compliance disclosure burdens faced by corporations over the past decades. He emphasized that the SEC should pursue “the minimum effective regulation,” with “materiality” as the guiding principle. He advocates that regulatory requirements should be dynamically adjusted based on a company’s size and maturity, and called for extending the “IPO buffer period” for new listings to encourage more small businesses to access capital markets.

More notably, Atkins strongly criticized the SEC’s past practice of using “comply or explain” requirements, which indirectly interfered with corporate governance. He candidly stated:

“Unless explicitly directed by Congress, the SEC’s role is not to enforce evolving best practices through what I call ‘regulation by shaming.’ Our mission is based on substantive disclosure, not to shame companies into governance doctrines.”

Previewing “Innovation Exemption” to greenlight tokenized securities

Regarding cryptocurrencies and blockchain technology, Atkins’s stance has excited the market. He specifically thanked the IAC for its in-depth discussion on “tokenization of equity securities” and agreed that tokenization can effectively improve settlement efficiency, reduce settlement risks, and eliminate unnecessary intermediaries.

To turn these potentials into reality, Atkins officially previewed the SEC’s next move:

“As I have discussed before, I expect the committee to soon review a ‘innovation exemption’ plan to facilitate limited trading of certain tokenized securities, focusing on developing a long-term regulatory framework.”

Crypto Task Force actively advancing, gathering public input

Atkins added that to refine the design of this exemption plan, the SEC’s Crypto Task Force has held multiple roundtable discussions over the past 13 months, engaging with hundreds of market participants and receiving numerous written suggestions on how to adapt existing rules for new types of trading.

He emphasized that this potential exemption will be “limited in time and scope,” but its duration will be sufficient for the SEC to develop more durable and flexible rules, fully harnessing these new technologies. These remarks undoubtedly inject confidence into Wall Street’s active layout of the RWA (Real World Asset) tokenization track.