SEC Chair Paul Atkins said this week that the agency is prepared to issue its own crypto regulations if Congress does not pass the CLARITY Act, a bill that would establish a federal framework for digital assets. The statement, made during a public appearance, signals the regulator's impatience with the legislative pace and its willingness to use existing authority to set rules for the industry.
The CLARITY Act's fate
The CLARITY Act has been under debate in Congress for months. It aims to define which digital assets are securities and which are commodities, and to give the Commodity Futures Trading Commission more oversight. But the bill has stalled amid disagreements over investor protections and the role of state regulators. Atkins's comments suggest the SEC is not willing to wait indefinitely.
What the SEC could do
Without new legislation, the SEC could rely on existing securities laws to regulate crypto. That could mean more enforcement actions against exchanges and token issuers, or it could mean issuing formal rulemaking that interprets current law for digital assets. Atkins did not specify which approach the SEC would take, but he made clear the agency has the tools to act. If the SEC moves forward with its own rules, it would likely propose a new framework and open it for public comment — a process that could take a year or more. Enforcement actions, by contrast, can happen immediately.
Industry reaction
The crypto industry has been pushing for clear rules, but opinions are split on whether Congress or the SEC should lead. Some firms worry that SEC-led regulation would be more restrictive than a tailored law. Others say any clarity is better than the current uncertainty. Atkins's statement adds pressure on lawmakers to move the CLARITY Act forward. The timing isn't great for the bill — the current congressional session is winding down, and other priorities are competing for attention.
For now, the ball is in Congress's court. If the CLARITY Act does not pass in the current session, the SEC is expected to begin its own rulemaking process before the end of the year. That would mark a significant shift in how crypto is regulated in the U.S., with the agency taking the lead instead of waiting for lawmakers.
