SEC to Consider Most Crypto Assets Not Securities Under Federal Law

SEC Chair Paul Atkins said on July 31, 2025 that the agency should treat most crypto assets as outside the securities bucket, a notable policy turn that could reduce registration pressure on token issuers and trading platforms, but the statement does not by itself change federal law or erase the Howey test.

The shift came in Atkins’s Project Crypto remarks, where he said, “Despite what the SEC has said in the past, most crypto assets are not securities.” He also said SEC staff had been directed to draft clearer guidance on when a crypto asset is a security, and when an offer, sale, or broader arrangement may still involve an investment contract.

What the SEC shift would mean for crypto under federal law

If regulators classify an asset as something other than a security, the immediate stakes are registration, disclosure, broker-dealer rules, and exchange oversight. That is why the classification question has sat at the center of US crypto enforcement for years.

Atkins framed the new direction as part of Project Crypto, an SEC initiative meant to modernize rules for distributions, custody, and trading of digital assets. The practical reading is narrower than the headline alone suggests: the SEC is signaling how it wants staff to approach crypto markets, while leaving room for fact-specific cases where an issuer, promoter, or contractual structure still falls under securities law.

That distinction matters because federal law does not ask only what the token is called. The Howey framework still looks at the economic reality of an arrangement, which is why an asset may trade on secondary markets without automatically making every related offer or scheme non-securities activity.

Commissioner Hester Peirce had already previewed this direction on May 19, 2025, arguing in a separate SEC speech that many common crypto assets should not fall under federal securities laws when they do not give holders economic rights in a business entity or promisor. Atkins’s July 31 speech pushes that view closer to the center of agency policy.

Which parts of the crypto market could feel the impact first

Crypto exchanges, listing committees, and token issuers would likely feel the first operational effects if the SEC follows through with formal guidance. A broader presumption that many tokens are not securities could lower the legal uncertainty around listings, secondary trading, and token distributions that had previously been assessed through an enforcement-first lens.

That does not mean all regulatory risk disappears. Platforms would still face anti-money-laundering, sanctions, state money-transmission, market-manipulation, and consumer-protection obligations, while token issuers could still face securities scrutiny if they package sales with profit promises, governance rights, or issuer-linked economic claims.

Axios described the July 31 move as an attempt to revive crypto capital formation, including token launches, airdrops, and other fund-raising models that had become legally toxic under the SEC’s prior posture. The report said the agency was moving quickly to implement White House working group recommendations and reopen pathways for crypto issuance that had effectively been frozen by uncertainty.

For market structure, this is more relevant to altcoin trading venues than to Bitcoin itself. Bitcoin’s status has generally been treated as closer to a commodity framework, so the larger policy delta falls on tokens and services that spent the last several years under the threat that ordinary market activity could be reinterpreted as unregistered securities conduct.

Why the debate still matters for Bitcoin and broader crypto policy

Bitcoin investors should read this as a jurisdiction and market-structure story, not a direct change to Bitcoin’s own monetary design. If token markets face fewer securities frictions, capital and developer attention may rotate more freely across the sector, even as Bitcoin continues to compete on different terms: censorship resistance, supply credibility, and settlement finality.

That broader policy opening may help explain why US crypto participation has remained a live strategic question for trading firms and platforms, as discussed in our recent coverage of rising US crypto spot market share. It also sharpens the need to separate verified regulatory action from overextended headlines, a theme that appeared in our review of the unsupported Phantom CFTC exemption claim.

Legal analysts have already cast Project Crypto as a meaningful deregulatory turn. WilmerHale partners wrote in an August 1, 2025 client alert that the initiative marked a more proactive and industry-friendly approach, while Coinbase chief legal officer Paul Grewal told the Associated Press that he appreciated the SEC’s stated push for balance.

The missing piece is still formal adoption. The research supporting this story did not identify a final SEC rule, commission vote, enforcement release, or new statute that codifies a blanket rule that most crypto assets are not securities under federal law, so the most defensible framing is that the SEC is preparing to consider and operationalize that view through guidance and future rulemaking.

Outlook for the next phase of SEC crypto policy

The next signal to watch is whether Project Crypto produces proposed rules, staff statements, no-action positions, or enforcement pullbacks that translate Atkins’s speech into durable agency practice. Until then, the market has a chairman’s roadmap, not a settled across-the-board legal conclusion.

For Bitcoin, the immediate effect is indirect but still relevant. A clearer boundary around token securities status could reduce regulatory noise across US digital-asset markets, while Bitcoin’s long-term case will still be judged on network fundamentals such as hash rate resilience, fee-market health, and the steady approach to the next halving cycle rather than on whether speculative token issuance gets a lighter rulebook.

Disclaimer: This article is for informational purposes only and does not constitute investment advice or legal advice.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always do your own research before making decisions.