Atkins, a former SEC commissioner, has been a vocal advocate of cryptocurrency.
Paul Atkins, President-elect Donald Trump’s selection to lead the Securities and Exchange Commission (SEC), could spark a cryptocurrency regulatory overhaul for the Wall Street watchdog.
Trump announced on Dec. 4 his nomination of the crypto proponent and former Wall Street regulator to head the commission, succeeding the outgoing Gary Gensler.
“He believes in the promise of robust, innovative capital markets that are responsive to the needs of Investors, & that provide capital to make our Economy the best in the World,“ Trump wrote on Truth Social. ”He also recognizes that digital assets & other innovations are crucial to Making America Greater than Ever Before.”
Atkins is a former SEC commissioner appointed by President George W. Bush in 2002, a critical moment for the finance sector as the markets were reeling from the Enron and WorldCom scandals.
In the past, Atkins has lambasted the federal government’s regulatory efforts, such as the Dodd-Frank Act, which was borne out of the global financial crisis.
“Despite a once-in-a-lifetime opportunity to streamline our crazy quilt of financial services regulators, the Dodd-Frank authors blew it,” Atkins said in a 2015 speech at a Brookings Institution event. “They created, depending on how you count, at least 15 new offices and agencies, eliminating only one, the hapless Office of Thrift Supervision, which had no one left to regulate, anyway.”
Atkins has been known as a crypto advocate in recent years, which would be a complete reversal from the current regulatory regime.
The commission oversees the U.S. financial markets and has cracked down on the crypto sector under Gensler’s leadership. Gensler, nominated by President Joe Biden in 2021, confirmed he will resign when Trump is inaugurated next month.
The outgoing SEC head stated last year that the crypto sector was filled with “Hucksters. Fraudsters. Scam artists. Ponzi schemes.”
“The crypto securities markets should not be allowed to undermine the well-earned trust the public has in the capital markets,” Gensler said in prepared remarks at the Piper Sandler Global Exchange and FinTech Conference in June 2023. “The crypto markets should not be allowed to harm investors.”
By tapping Atkins as SEC chief, Trump could be signaling that the regulatory structure for crypto is about to change.
Atkins has been a vocal critic of the SEC, telling CNBC this past summer that the cop on the beat is in a “mess right now over there.”
“I think a lot of work needs to be done. There needs to be a change of course,” the founder and CEO of Patomak Global Partners told the business news network.
In a podcast interview last year, Atkins touted the benefits of cryptocurrency and its underlying technology and why it is crucial for the sector to thrive in the U.S. economy.
This, Atkins says, does not mean the SEC should turn a blind eye to the marketplace.
“The SEC should be there with its ear to the ground to figure out which way things are moving, and let’s try to accommodate activity that’s not criminal and then enable markets to flourish because it challenges incumbents and it helps bring down costs for investors and for people who are trying to raise capital,” Atkins said.
This past spring, appearing at an event organized by The Federalist Society, Atkins stated that regulators need to adapt to technological innovations and market changes.Meanwhile, various market participants have welcomed the decision.
“We appreciate his commitment to balance in regulating U.S. securities markets and look forward to his fresh leadership at the SEC,” Paul Grewal, chief legal officer of Coinbase, said on social media platform X. “It’s sorely needed and cannot come a day too soon.”
Ripple CEO Brad Garlinghouse called the Atkins nomination an “outstanding choice” that will complement the presence of other pro-crypto regulators at the SEC: Hester Peirce and Mark Uyeda.
“It’s time to swiftly and definitively end the prohibition era on crypto, restoring freedom of choice, economic growth, and innovation,” Garlinghouse wrote on X.
Uyeda has been a key crypto ally at the Wall Street regulator, agreeing with Trump that the “war on crypto needs to stop.”
“There are a number of things that we can do with respect to crypto to help make America one of the global leaders in crypto,” Uyeda said in an interview with FOX Business’s “Varney & Co.” earlier this month. “President Trump and the American electorate have sent a clear message. Starting in 2025, the SEC’s role is to carry out that mandate.”
Peirce encouraged better dialogue between SEC regulators and the crypto sector.
Alexandr Sharilov, the CEO of crypto analytics company CoinDataFlow, is optimistic about the incoming SEC chief, but he also said balance will be key.
“SEC chairman can help create space for growth without excessive oversight and complete control. However, it is clear that balance is key. Innovation thrives in a flexible environment, but too weak regulation can lead to chaos and damage trust in the crypto sector,” Sharilov told The Epoch Times.
During the campaign trail, Trump espoused a pro-crypto platform. He promised to start a national bitcoin reserve, establish a presidential crypto advisory council, and facilitate a climate of ensuring all remaining bitcoins are mined in the United States.
Trump vowed to make the United States the “crypto capital of the planet.”
“We will have regulations, but from now on, the rules will be written by people who love your industry, not hate your industry,” he said at the annual bitcoin conference in July.
Trump has filled his administration with crypto supporters, including hedge fund manager Scott Bessent as treasury secretary and billionaire Howard Lutnick as commerce secretary.
“I have been excited about Trump’s embrace of crypto and I think it fits very well with the Republican Party, the ethos of it. Crypto is about freedom, and the crypto economy is here to stay,” Bessent said in an interview with FOX Business in July. “Crypto is bringing in young people, people who have not participated in markets.”
Lutnick’s financial services firm, Cantor Fitzgerald, has been a custodian for stablecoin company Tether’s reserves.
Bitcoin prices have rocketed this year, fueled by regulatory optimism. The premier cryptocurrency topped $100,000 for the first time ever on Dec. 4.