The stock market and values commission announced A new cryptography working group dedicated to developing clear regulatory frameworks, which marks a change of their previous approach focused on the application of digital assets.
The initiative, announced by the acting president of the Sec Mark T. Uyeda and led by Commissioner Hester Peirce, arrives while the background broadcasters expect clearer guidelines for launching investment products, a development that could remodel the way companies approach Digital assets offers after years of regulatory uncertainty.
According to the announcement of La Sec, the Working Group will collaborate with several divisions of the Sec, other federal agencies and the public to establish reasonable regulatory routes. Under Peirce’s leadership, the group aims to offer realistic paths for registration and create reasonable outreach frameworks.
“One of the guidelines of the working group will be to create a clear path for the registration for participants in the cryptographic market,” he told ETF.com Amy Lynch, founder and president of the strategic consultant Frontline Compliance, in an email. “Although there is already a current path, the process has a lot of room for improvement.”
The working group aims to address the rules of custody that have previously hindered the innovation of cryptographic products, according to Lynch. “The current rules of custody that exists do not take into account cryptocurrencies or digital assets,” he said.
A 2023 custody rule tried to address digital assets, but “was far below what the market needed,” said Lynch. The working group can review these requirements through the Second Investment Management Division.
The coordination between the regulators will play a key role as the frame develops. “There must be coordination with the (Commodity Futures Trading Commission), especially if the definition of a value is updated to add clarity when the cryptography is a security and when it is a commodity,” said Lynch.
Although regulatory changes require time, Lynch suggests that the initiative opens new opportunities. “The floodgates are now open and now is the time for funds to be sent, as we will see that many more digital assets ETF will be released next year,” he added.
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