First 90 Days SEC Policy Overhaul Agenda Under Donald Trump

At a meeting with staffers for SEC Commissioners Hester Peirce and Mark Uyeda, the Digital Chamber of Commerce’s Token Alliance introduced an ambitious policy agenda aimed at overhauling the SEC’s regulatory approach to digital assets.

🚨NEW: At a meeting with staffers for @SECGov commissioners @HesterPeirce and Mark Uyeda this week, the @DigitalChamber’s Token Alliance included denouncing the 2018 #Hinman speech as a Day 1 priority for the Corporation Finance division, citing its lack of relevance to the Howey… pic.twitter.com/5RACe4vBNL

— Eleanor Terrett (@EleanorTerrett) December 18, 2024

The proposals, spanning the first 90 days of Donald Trump’s new administration, highlights immediate and sweeping changes to reset the agency’s relationship with the cryptocurrency sector.

Day 1 Agenda: A Fresh Start for Crypto Regulation

The Day 1 agenda for the SEC’s Corporation Finance division focuses on establishing clarity and fostering innovation:

1. Rescind the 2019 Framework for “Investment Contract” Analysis of Digital Assets: Criticized for its broad and impractical approach, the framework has left market participants without actionable guidance or support.
2. Denounce the 2018 Hinman Speech: The Chamber called for the SEC to formally state that the speech, which has caused confusion and market distortion, is not agency guidance.
3. Issue No-Action Letters and Commission Statements: The Chamber urged the SEC to clarify several key areas, including:
   a. Blockchain network functions that are not securities transactions.
   b. Provisional definitions for when digital assets implicate securities laws, offering clarity beyond the Howey test.
   c. Categorizing specific digital assets like native tokens, stablecoins, and NFTs as non-securities.
   d. Providing transparency on why Bitcoin and Ethereum were deemed non-securities, creating a consistent framework for other tokens.
   e. Offering clarity around staking activities that do not constitute securities transactions.
4. Begin Rulemaking on a Token Safe Harbor Proposal: This would establish clear rules for when token sales are no longer considered investment contracts and the networks are deemed decentralized.
5. Set the Tone for Leadership: The Interim Chair and incoming Chair Paul Atkins were encouraged to issue public statements resetting the SEC’s relationship with crypto stakeholders and outlining blockchain-related priorities.

Some of the Agendas for First 30 Days

1. Issuing provisional rules for broker-dealers to trade and custody digital assets.
2. Establishing no-action relief for broker-dealer operations using blockchain for payments.
3. Initiating reforms in enforcement to focus only on cases involving actual fraud or loss while dismissing theory-based litigation.
4. Expanding investment options for registered funds and recognizing self-custody of digital assets until qualified custodians are established.

Some Agendas for Days 30–90:

1. Finalizing the definition of when digital assets implicate securities laws, in coordination with the CFTC, Congress, and the Administration.
2. Proposing Token Safe Harbor rules to provide clear pathways for decentralized network recognition.
3. Establishing specific disclosure standards tailored to digital assets that implicate securities laws.
4. Providing a clear registration path for digital asset-related businesses, including token issuers.
5. Approving additional spot ETF applications for assets like SOL, XRP, and BITW.
6. Revisiting requirements for national securities exchanges to list digital asset ETFs, aiming to align them with global standards.