SEC Chairman predicts: The global financial market is about to enter the on-chain era

Paul Atkins, the new Chairman of the U.S. Securities and Exchange Commission (SEC), has just announced a bold perspective on the future of the U.S. capital markets. In an interview at the New York Stock Exchange with Fox Business on December 3rd, he predicted that the entire U.S. financial system could transition to blockchain technology in the coming years. This is a clear signal that U.S. regulators are shifting their attitude from cautious to proactively embracing technological innovation.

From Traditional Securities to Digital Assets: The Management Revolution

Since officially taking office as SEC Chairman in April this year, Paul Atkins has consistently expressed support for cryptocurrencies from a regulatory standpoint. He emphasized that one of the top priorities during his term is to build a reasonable regulatory framework, establish clear rules for issuing, custody, and trading digital assets, and prevent illegal activities.

Atkins notes that the market changes over the past 30 years have been revolutionary. From traditional manual exchanges to electronic trading, from manual data processing to full automation. However, he believes the next major wave of change will come from the digitization and tokenization of the stock market.

Why Tokenization Matters: Overcoming Current Barriers

According to the SEC Chairman, the core advantage of tokenization lies in its high transparency. If assets exist on the blockchain, ownership structures and asset attributes will be extremely clear and traceable. This is completely different from the current situation, where publicly listed companies often do not know exactly who their shareholders are, where they are located, or where their stock certificates are held.

Furthermore, tokenization aims to achieve T+0 clearing and settlement, replacing the current T+1 cycle. In principle, the Delivery versus Payment (DVP) mechanism on blockchain can significantly reduce market risk. The time between clearing, settlement, and fund transfer is one of the main sources of systemic risk today.

Atkins emphasizes that on-chain transparency not only benefits investors but also helps regulators monitor and control the market more effectively.

Specific Roadmap: What Will the SEC Do Next

The SEC Chairman not only shared optimistic views but also announced concrete actions. The SEC recently renamed the “Crypto Task Force” to “Project Crypto,” demonstrating a long-term commitment to the field.

Atkins announced that the SEC will introduce the “Innovation Safe Harbor” policy next month. This policy allows companies to validate ideas within specific controlled limits such as operational duration, maximum number of users, and permitted fund size before commercializing the product after SEC approval.

At the same time, the SEC has proposed a new classification framework to clarify which assets qualify as securities. Clearly tokenized securities remain securities and must comply with SEC regulations, while digital commodities, digital utilities, and other asset types will be classified differently. The SEC will continue to apply the “Howey Test” established by the Supreme Court in 1946 to determine the definition of securities.

Collaboration Between Regulators

Atkins thanked Congress for passing the Geniuses Act, marking the U.S. official recognition of stablecoins as a legitimate digital product. Additionally, the Clarity Act has been passed by the House and is awaiting further progress.

One of the most important steps is that the SEC and CFTC are actively coordinating their regulatory frameworks. In the past, these two agencies had disagreements, leading to many potential products being excluded due to regulatory gaps. Currently, the CFTC has expertise in futures and derivatives markets, while the SEC understands the spot market, so cooperation between the two will yield positive results.

Why This Matters

The collapse of FTX once caused turmoil in the industry, but Atkins pointed out that customer accounts protected by CFTC rules were safe during this incident. This is proof that good regulation protects investors.

The SEC Chairman emphasized that modernizing the market is positive, but the issue is that the SEC has recently moved away from its historical tradition. Although the SEC is not always a pioneer of innovation, it must at least stay close to the market. In recent years, the SEC has almost been opposed to market innovation. Atkins is determined to change this: the U.S. must lead in the field of cryptocurrencies and digital assets.

The world may not even need 10 years — perhaps just a few years — for the transition to blockchain to become a reality. Atkins believes we need to bring new technology into the U.S. so it can thrive under American regulation, rather than developing elsewhere where the U.S. cannot control it.