SEC Relaxes Cryptocurrency Regulations to Encourage IPOs and Attract New Investors

The U.S. Securities and Exchange Commission (SEC) is moving forward with a regulatory proposal designed to simplify the process for launching digital asset products, as revealed by SEC Chair Paul Atkins. This proposed "innovation exemption" would temporarily ease current securities regulations, allowing crypto companies to roll out new offerings with reduced regulatory scrutiny while the SEC crafts more specific rules. This initiative is part of the agency’s broader "Project Crypto" strategy, which began in July 2025, to update oversight for digital assets SEC's Atkins Says Agency Pushing Toward 2025 Rules Allowing [ 1 ].

Atkins stated that the innovation exemption is meant to establish a "reliable foundation" for crypto businesses to develop new products without being hindered by outdated regulations. The SEC intends to complete the exemption by the end of the year, with comprehensive rules to follow in 2026 SEC Plans Innovation Exemption to Speed Crypto Launches [ 2 ]. This exemption would act as a regulatory exception, letting companies avoid certain compliance requirements for innovative products while still upholding investor protections. This marks a shift from the SEC’s previous focus on enforcement under former Chair Gary Gensler, signaling a new emphasis on supporting innovation alongside market stability US SEC eyes ‘innovation exemption’ to fast-track digital asset … [ 3 ].

The SEC’s actions are part of a joint effort with the Commodity Futures Trading Commission (CFTC) to align regulatory approaches. A joint roundtable is set for September 29 to address overlapping regulatory duties and clarify the boundaries between crypto securities, commodities, and other asset types SEC Plans ‘Innovation Exemption’ to Streamline Crypto Product … [ 4 ]. The SEC has also set out general listing requirements for exchange-traded products (ETPs) that hold cryptocurrencies, aiming to speed up approvals and lower entry barriers for new products. These reforms come after the approval of the first multi-asset crypto ETP in the U.S., which utilized the newly introduced Rule 6c-11 SEC Chair Paul Atkins Says Crypto 'Innovation Exemption' Coming … [ 5 ].

Atkins connected the innovation exemption to a larger objective of revitalizing U.S. public markets, which have seen a steady drop in listed companies over the last thirty years. By lowering regulatory barriers for crypto firms, the SEC hopes to boost the number of initial public offerings (IPOs) and attract more investors. He also pointed out the importance of staying competitive globally, warning that the U.S. could lose ground in digital finance if it does

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The proposed exemption has caught the attention of Congress, where bipartisan legislation—mirroring the House’s Digital Asset Market Clarity Act—is being discussed. Supporters are pushing for committee review by late October, and Atkins has voiced his backing for legislative clarity while noting that the SEC retains authority to set policy independently Fed Cuts Rates for First Time in 2025. What's … [ 7 ]. The SEC’s agenda also features new rules for the issuance and sale of crypto assets, including exemptions and safe harbors for airdrops and network rewards.