From going after crypto startups to seeking counsel — has the SEC aged well?

Is the SEC’s ten-city roadshow evidence of wisdom earned with time, or will startups still see it as a watchdog in disguise?

SEC launches the road tour

On Aug. 1, the Securities and Exchange Commission introduced Crypto Task Force on the Road, a national tour designed  to bring small crypto startups into direct conversation with regulators. 

The stated goal is to capture perspectives from the youngest and least represented crypto firms before new rules are finalized. 

The Commission has said these sessions will help identify areas where current regulations do not match how early projects actually operate, and where compliance obstacles may be pushing innovation overseas.

The program will span ten cities between August and December, starting in Berkeley on Aug. 4 and ending in Ann Arbor on Dec. 5. 

Other stops include Boston on Aug. 19, Dallas on Sep. 4, Chicago on Sep. 15, New York on Sep. 25 and Nov. 12, Irvine on Oct. 3, Cleveland on Oct. 24, and Scottsdale on Oct. 29. 

Each meeting is structured as a small roundtable rather than a large public forum, allowing startups to explain directly how rules affect their ability to launch products, raise funds, and build teams.

Eligibility is restricted to companies with fewer than ten employees and less than two years of activity. Each team may send one or two representatives, and applications require a short description of the project. 

The SEC will publish the names of all participants after each session to maintain transparency. 

Chicago’s stop is being watched closely because it brings the discussion to one of the country’s financial centers, far from Washington where policy conversations usually take place.

The tour follows five roundtables the SEC held in Washington earlier this year, from March through June, where established firms debated issues such as token classification, custody, and DeFi. 

While those events were livestreamed and archived, they leaned heavily on voices with lobbying presence in the capital. The new directive expands the conversation to early-stage teams.

Task force with teeth

For years, the SEC’s engagement with crypto startups was dominated by enforcement. 

Between 2020 and 2024, the agency brought more than 120 cases against token issuers, trading platforms, and lending projects. 

Ripple (XRP), LBRY, and BlockFi became high-profile examples, while many smaller startups faced subpoenas and fines for offering what the Commission deemed unregistered securities. 

Under then Chair Gary Gensler, the agency repeatedly said most digital tokens fell under existing securities law. The result was an environment where founders often expected their first contact with the SEC to be an investigation. 

That picture began to change with Donald Trump’s return to the White House. 

Since assuming the office, Trump revoked Biden-era directives, prohibited federal development of a central bank digital currency, and created a Presidential Working Group on Digital Assets tasked with producing a national framework within six months. 

A White House crypto summit later on brought industry leaders to Washington, where Trump declared an end to what he called the “war on crypto.” 

To coordinate policy across agencies, Trump appointed investor and entrepreneur David Sacks as “crypto and AI czar,” giving the industry a direct channel into the administration.

In this environment, Paul S. Atkins was sworn in as SEC Chair on Apr. 21. A former Commissioner from 2002 to 2008, Atkins had built a reputation as a supporter of lighter-touch regulation. 

Within his first 100 days he moved to overhaul the agency’s crypto posture. On Jul. 31 he announced Project Crypto, a comprehensive effort to clarify how digital assets are categorized, distinguishing securities from commodities, stablecoins, and collectibles, and to create exemptions for activities such as ICOs, airdrops, and network rewards. 

He also called for a single license framework that would allow platforms to handle both securities and non-securities under one regulatory umbrella. 

In speeches, Atkins criticized the SEC’s prior approach as “shoot first and ask questions later,” and argued that treating nearly all tokens as securities was driving innovation overseas.

Meanwhile, the SEC announced the creation of its Crypto Task Force, led by Commissioner Hester Peirce. 

The mandate included developing clearer frameworks for token classification, designing realistic registration paths, and creating disclosure requirements better suited to digital assets. 

The new approach did not eliminate enforcement but signaled an intent to pair it with structured dialogue. 

The “on the road” program grows directly out of the SEC’s new approach. After hearing from established stakeholders in the capital, the Commission extended its outreach to small, early-stage teams that rarely appear in hearings or submit formal comments. 

What’s driving the shift to dialogue

The SEC’s shift toward engagement, rather than enforcement, is fueled by specific, measurable pressures, mainly regulatory, economic, and political.

Market scale that cannot be ignored

Crypto markets are now too large for piecemeal enforcement to make sense. As of Aug. 20, global digital asset market cap exceeds $3.8 trillion, with Bitcoin alone over $2.25 trillion and daily U.S. exchange volumes often surpassing $50 billion. 

Washington risks lagging if it remains reactive rather than proactive in shaping frameworks around such large-scale innovation.

Global funding shifts and U.S. weakness

The flow of venture capital shows how regulatory posture influences competitiveness. In 2021, nearly half of all global crypto funding was directed to U.S. projects. In late 2024, that share had dropped below one-third. 

Data from Galaxy Research shows that in Q2 2025, crypto startups worldwide raised $1.97 billion across 378 deals, a 59% decline from the previous quarter. 

While the slowdown has been global, founders in the U.S. consistently point to unclear rules as a major drag. 

The SEC’s outreach is partly a response to these figures, seeking to understand the obstacles before more capital and talent permanently relocate to Singapore, Dubai, or other crypto-friendly jurisdictions.

Trump’s direct pressure on regulators

Trump has not only reversed earlier directives but has positioned himself as one of the most vocal heads of state in support of crypto. 

His administration established a Strategic Bitcoin Reserve, permitted 401(k) accounts to include digital assets, and used the March 2025 White House summit to declare that the “war on crypto” was over. 

Combined with his own vested interests in crypto through multiple ventures, these moves created direct pressure on regulatory agencies to demonstrate alignment. For the SEC, dialogue with small startups is a way to show that shift in real terms.

Startups at the table

The specific issues that small teams are expected to bring into the room have been circulating in industry circles for years but have rarely been heard directly in a regulatory setting.

The most pressing is the ongoing uncertainty around token classification. Startups that build payment systems, gaming applications, or decentralized services often design tokens that function as utilities. 

Yet under current law, many of these instruments risk being treated as securities, discouraging investment in utility-token projects and complicates fundraising.

Compliance costs also weigh heavily. These figures are often cited in contrast to Singapore and Dubai, where licensing is standardized and far cheaper. 

Startups are likely to emphasize that this cost imbalance is one of the reasons why new projects are increasingly launched abroad.

Banking access has also been a flashpoint. After the failures of Signature Bank and Silvergate in 2023, many regional banks pulled back from serving crypto accounts. 

This has left early-stage teams struggling to process payroll or manage operations despite not handling customer deposits directly. 

Federal banking regulators, including the Office of the Comptroller of the Currency (OCC), Federal Reserve, and Federal Deposit Insurance Corporation (FDIC), have made moves to reduce prior restrictions and offer clearer guidance

However, the issue is expected to resurface in the SEC’s sessions, as founders press for further clarity that could reduce banks’ reluctance to work with the sector.

Custody and disclosure requirements are another recurring theme. SEC frameworks often assume the resources of large exchanges or funds, yet most startups operate with small user bases and limited assets under management. 

Industry groups have pointed out that the same standards applied across the board create barriers to entry and discourage experimentation by smaller firms.

These topics are not new, but the setting is. Chicago and the other roadshow stops will be the first time many of these concerns are aired in a structured dialogue with the regulator itself. 

Whether the SEC chooses to incorporate this input will determine if the roadshow marks a genuine shift in posture or a temporary exercise.