The U.S. Securities and Exchange Commission (SEC) has announced the advancement of its “SEC Crypto 2.0” initiative.

It signals a stronger regulatory framework for digital asset securities. As part of this initiative, the agency has also proposed the establishment of a Presidential Task Force on Cryptocurrency.

The U.S. Securities and Exchange Commission (SEC) is advancing its "SEC Crypto 2.0" initiative with a focus on integrating digital asset securities into existing financial market structures.

The SEC Contributes to Broader Presidential Task Force on Cryptocurrency

The SEC's proposals, part of a broader initiative to coordinate federal agency activities in response to the rise of digital assets, include amendments to the Securities Exchange Act of 1934. These changes are crucial for adapting the regulatory landscape to the unique characteristics of digital asset securities.

The proposals, open for public comment for 90 days, also suggest the formation of a Presidential Task Force on Cryptocurrency. The task force, a joint effort involving the SEC, Commodity Futures Trading Commission (CFTC), Treasury Department, and Internal Revenue Service (IRS), aims to coordinate the agencies' activities in response to the growing importance of cryptocurrency.

The task force would be responsible for monitoring and coordinating federal agency activities related to cryptocurrency, an area that has seen a rapid influx of new technologies and use cases. The goal is to ensure consistent regulations across agencies and provide clear guidance to market participants.

SEC Proposes Changes to Securities Exchange Act for Crypto Regulation

The SEC proposals also include changes to reporting requirements for digital asset securities purchases, aiming to align them with the reporting rules for regular securities.

"The SEC proposals are a significant step in the right direction," said Tom Hayes, managing partner at Covington. "They recognize the need for Congress to act quickly to provide the SEC with the authority it needs to regulate crypto exchanges and other platforms."

The changes in reporting requirements would apply to purchases of digital asset securities through on-blockchain and off-blockchain systems, ensuring consistency in reporting across different modes of purchase.

"We believe that it is essential to maintain the same high level of reporting for all types of securities, regardless of the technology used to purchase them," said SEC Chair Gary Gensler. "This will help to maintain a level playing field and provide investors with the information they need to make informed investment decisions."

The SEC proposals come as Congress is also considering legislation to regulate cryptocurrency. The Lummis-Gillibrand bill, for example, would create a new regulatory framework for digital assets, including a definition of what constitutes a "digital asset service provider."

"The SEC proposals are a welcome development, but they are not enough," said Caitlin Long, founder and CEO of Factor Chain, in response to the SEC proposals. "Congress needs to act swiftly to provide the SEC with the authority it needs to regulate crypto exchanges and other platforms."

The SEC proposals are part of a broader effort by U.S. regulatory agencies to adapt to the changing financial landscape. The proposals will be open for public comment for 90 days.