The U.S. Securities and Exchange Commission (SEC), led by new Chair Paul Atkins, has launched “Project Crypto”, a comprehensive regulatory initiative unveiled on July 31, 2025. This policy shift is designed to modernize digital asset rules, clarify crypto classifications, and signal a pro-innovation direction from Washington toward decentralized finance (DeFi) and tokenized markets.
What Is Project Crypto?
Atkins introduced Project Crypto following a 160‑page report released by the Trump administration’s crypto working group, which urged sweeping reforms to support the United States as a global leader in financial technology. Key reforms include:
- Clear definitions to help determine whether crypto assets are securities or investment contracts. Atkins emphasized that “most crypto assets are not securities”.
- A framework allowing “super-apps”, letting broker‑dealers offer crypto trading, staking, lending, and securities under one license.
- A fresh regulatory approach to facilitate the integration of DeFi and tokenized securities into existing capital markets infrastructure.
- Tailored exemptions and disclosure standards for practices like ICOs, token airdrops, and network rewards.
Industry insiders believe this marks an inflection point—a realignment away from enforcement‑led policies toward rule‑based clarity and innovation.
Market Reaction
Crypto markets responded positively. Bitcoin climbed to near $120,000, while Ether continued its recent recovery to about $3,800, supported by rising institutional demand and improved sentiment.
Experts such as Matt Hougan of Bitwise called it “the start of a major new era for crypto…a bullish era with reduced risk and increased opportunity”. Meanwhile, Louis LaValle of Frontier Investments described the shift as a dismantling of the “Gensler‑era framework” and a return of U.S. leadership in crypto.
Paul Atkins signaled that the SEC will enable a modern era for ICOs, backed by stronger transparency and regulatory support. Despite the notorious ICO bubble of 2017, experts from Tokensoft and CoinList suggest that blockchain maturity and compliance will allow token sales to become viable again—this time under scrutiny and clarity.
If enacted effectively, these measures could open capital raising to retail investors safely, reviving token fundraising with proper disclosure and oversight.
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The report’s recommendations already intersect with pending congressional action. For instance, the CLARITY Act, aimed at clearly dividing crypto jurisdiction between the SEC and the Commodity Futures Trading Commission (CFTC), and stablecoin legislation, are progressing through Congress.
The SEC, under Atkins’s mandate, is expected to issue rule proposals and disclosure standards in coming months. Meanwhile, collaboration between the SEC and CFTC on spot-market oversight and custody rules is anticipated to bring greater cohesion across U.S. crypto regulation.
Project Crypto has the potential to transform U.S. crypto policy from adversarial enforcement to proactive facilitation. Its success hinges on precise rule‑making, meaningful enforcement that fosters innovation, and robust protections that shield investors while enabling capital formation.
If carried out thoughtfully, Project Crypto could reaffirm the United States as a digital asset hub—restoring confidence among entrepreneurs, institutions, and everyday users alike.
