The Securities and Exchange Commission announced a new crypto task force dedicated to developing clear regulatory frameworks, marking a shift away from its previous enforcement-focused approach to digital assets.
The initiative, announced by acting SEC Chairman Mark T. Uyeda and led by Commissioner Hester Peirce, arrives as fund issuers await clearer guidelines for launching investment products—a development that could reshape how firms approach digital asset offerings after years of regulatory uncertainty.
The task force will collaborate with various SEC divisions, other federal agencies, and the public to establish sensible regulatory paths, according to the SEC announcement. Under Peirce’s leadership, the group aims to provide realistic paths to registration and craft sensible disclosure frameworks.
“One of the directives of the task force will be to create a clear path to registration for crypto market participants,” Amy Lynch, founder and president of strategic consultancy FrontLine, told etf.com in an email. “Even though a current path already exists, the process has much room for improvement.”
The task force aims to address custody rules that have previously hindered crypto product innovation, according to Lynch. “The current custody rules that exist do not account for cryptocurrencies or digital assets,” she said.
A proposed custody rule from 2023 attempted to address digital assets but “fell well short of what the market needed,” Lynch noted. The task force may revise these requirements through the SEC’s Division of Investment Management.
Coordination between regulators will play a key role as the framework develops. “There will have to be coordination with the [Commodity Futures Trading Commission] especially if the definition of a security is updated to add clarity to when crypto is a security and when it’s a commodity,” Lynch explained.
While regulatory changes take time, Lynch suggests the initiative opens new opportunities. “The floodgates are now open, and now is the time for funds to send in applications as we will see many more digital asset ETFs come to market in the next year,” she added.