US SEC
Paul Atkins revealed that the SEC is studying an “innovation exemption” for DeFi, reflecting a shift in the Trump administration’s stance on cryptocurrency regulation.
(Background: Michigan proposes four cryptocurrency bills: pension fund investment in BTC, green mining and tax incentives, opposition to CBDC)
(Context: Opinion: Never underestimate the US stablecoin legislation)
SEC’s Proposal for “Innovation Exemption” Simplifies DeFi Development
The US Securities and Exchange Commission (SEC) ### Paul Atkins disclosed on June 9, 2025, that the SEC is actively studying an “innovation exemption” to provide decentralized finance (DeFi) platforms, aiming to lower regulatory barriers and facilitate developers.
During the SEC’s fifth cryptocurrency roundtable, Atkins ### clearly indicated that the research on DeFi “innovation exemption” is intended to simplify the development path. He has instructed his staff to explore rule revisions to “provide necessary conveniences for issuers and intermediaries seeking to manage on-chain financial systems.”
This potential exemption, referred to by Atkins as the “innovation exemption,” is expected to allow regulated entities to “quickly” bring on-chain products and services to market.
This stands in stark contrast to the enforcement-focused approach emphasized by former ### Gary Gensler, indicating that the SEC’s regulatory model is shifting from enforcement-first to rule-making and collaboration. Atkins expressed regarding blockchain innovation potential, “We should not automatically fear the future.”
Regulatory Mindset Shift: Focus on Developer Responsibility and Innovation
SEC ### Paul Atkins and Commissioner Hester Peirce both believe that developers should not be blamed simply because others use the code they developed (DeFi tools), as this may implicate the First Amendment rights of free speech under the US Constitution. Commissioner Peirce pointed out:
“The SEC should not regulate merely because someone has released code, and others utilize that code for activities traditionally regulated by the SEC, thereby infringing on their First Amendment rights.”
If the “innovation exemption” is implemented, it is expected to accelerate the development of on-chain financial products, provide legal clarity, and solidify the US’s leading position in crypto innovation. However, challenges remain, as the SEC must effectively distinguish between genuine and pseudo-decentralized projects. Commissioner Peirce warned:
Centralized entities cannot merely evade regulation by labeling themselves as ‘decentralized.’
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