The U.S. Securities and Exchange Commission’s newly launched “Project Crypto” could mark a turning point in financial regulation, according to a new note by brokerage firm Bernstein.
Under the leadership of SEC Chair Paul Atkins, the initiative aims to modernize outdated securities laws for the blockchain era, a move Bernstein calls the boldest crypto vision ever proposed by a U.S. regulator.
Unveiled in a keynote speech titled “American Leadership in the Digital Finance Revolution” on July 31, Atkins positioned Project Crypto as the next major step in U.S. market evolution, drawing parallels to milestones like the founding of the NYSE in 1792 and the shift to electronic trading in the 1990s.
According to Bernstein analyst Gautam Chhugani, Project Crypto is designed to bring innovation back to U.S. soil after years of regulatory uncertainty pushed crypto firms offshore. The SEC now plans to offer clear classifications for digital assets, separating them into digital commodities, stablecoins, and collectibles, and move away from the blanket application of the Howey Test.
Atkins is also pushing for U.S.-regulated tokenized stocks and bonds, and major players from Wall Street to Silicon Valley are already showing interest. The idea is to let broker-dealers offer both crypto and traditional financial services under one license, making things much simpler and more efficient.
Another big change is the SEC’s move to bring decentralized finance (DeFi, like automated trading and lending platforms, into the legal framework. If that happens, it could open the door to round-the-clock trading, faster settlements, and a more modern financial system.
In a clear departure from former Chair Gary Gensler’s enforcement-led approach, Atkins stated that America must lead, not follow, in the global digital finance race. “The future is arriving at full speed — and the world is not waiting,” he said.
Bernstein’s Gautam Chhugani said Project Crypto has the potential to break down long-standing regulatory barriers and open capital markets to a wider range of participants. He added that it’s time for the financial system to move from being online to fully onchain.
With implementation still ahead, Project Crypto signals a regulatory sea change, one that could reshape how Wall Street and blockchain coexist in the years to come.
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