SEC Chair Paul Atkins Clarifies Crypto Tokens’ Status as Securities
In a significant speech on Wednesday, SEC Chair Paul Atkins provided his most explicit comments yet on the regulatory status of crypto tokens. Speaking under the second Trump administration, Atkins clarified the limited circumstances under which the Securities and Exchange Commission plans to oversee the rapidly expanding crypto industry.
### Most Crypto Tokens Not Considered Securities
Consistent with previous statements from Atkins and fellow Republican commissioner Hester Peirce, the SEC chair emphasized that most crypto tokens should not be classified as securities. This includes a broad category known as “network tokens,” which are linked to functional, decentralized blockchain networks. Popular examples likely falling under this category include Ethereum, Solana, and XRP.
Atkins also identified “digital collectibles” as a separate exempt category. These tokens typically represent rights to digital media or, importantly, reference internet memes, characters, current events, or trends. This definition appears to exclude many of the wildly popular and volatile meme coins from SEC regulation.
A third category Atkins highlighted is “digital tools” — crypto assets that provide practical functions such as tickets, memberships, or badges. According to Atkins, these too should not be considered securities.
### Managerial Promises Key to Defining Securities
Atkins explained the reasoning behind these categories, underscoring that only crypto assets tied to explicit and unambiguous managerial promises should qualify as securities. In his view, a token should be considered a security only when purchasers are “expecting profits from the essential managerial efforts of others,” and such expectations are based on clear promises issued by a third party.
Given this standard, the majority of tokens trading today likely do not fall under SEC jurisdiction. Moreover, if a crypto token initially qualifies as an investment contract, it could lose that status once the issuer fulfills, fails, or terminates those managerial promises.
### Tokenized Securities and “Super Apps”
Atkins noted that “tokenized securities” — representations of existing securities regulated by the SEC but traded on blockchain — would remain under SEC oversight.
However, he reiterated his support for the growth of so-called “super-apps”: platforms that enable the trading of both securities and non-securities within the same ecosystem. Atkins revealed that he has asked SEC staff to prepare recommendations allowing securities to trade on platforms not regulated by the SEC.
He stated, “While capital formation should continue to be overseen by the SEC, we should not hamstring innovation and investor choice by requiring the underlying assets to trade in one regulated environment versus another.”
### The SEC’s Purpose and Crypto Regulation
Reflecting on the SEC’s original mission, created in the wake of the Great Depression, Atkins argued that the agency’s mandate should not be stretched to cover most of the crypto industry.
“Congress crafted the securities laws to address specific problems — situations in which people part with their money based on promises that depend on the honesty and the competence of others,” Atkins said. “They were not designed as a universal charter to regulate every novel form of value, digital or otherwise.”
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Paul Atkins’ speech offers critical insight into the evolving stance of the SEC towards crypto tokens, highlighting a regulatory approach focused on clear managerial promises rather than broad categorization. This clarification brings fresh perspective to the debate around how digital assets should be governed in the years ahead.
https://bitcoinethereumnews.com/crypto/sec-chair-paul-atkins-reveals-which-crypto-tokens-he-thinks-are-securities/
