Policy shifts for SEC signals that could rebuild Defi Regulation

The Securities and Exchange Commission (SEC) begins to outline a new, more constructive regulatory direction for Decentralized Financial (DEFI), indicating a major policy shift towards a greater alignment between crypto protocols and federal law.

In a recent roundtable, new SEC Chairman Paul Atkins highlighted Defi’s compatibility with American values, including freedom, property rights and technological innovation. His comments come amidst a wider structural change in the agency, including a decrease in reliance on litigation and an increased focus on formal rules to provide clarity to the industry.

Deviation from “Enforcement Regulations”

The SEC’s approach to Crypto’s surveillance has changed dramatically since former chairman Gary Gensler set out on January 20th. Under Gensler, the committee faced widespread criticism of pursuing regulatory targets primarily through enforcement measures and costly litigation.

According to Atkins, that strategy is no longer the default. Speaking before the Senate Budget Subcommittee on June 3, Atkins said that the SEC rulemaking will follow a formal “notification and comment” process, allowing industry feedback and creating clearer guidelines for market participants.

The procedural changes are central to the SEC’s new Crypto Task Force, which was established on January 21, and will publish its first formal report in the coming months.

What does the new SEC stance mean for the Defi market?

Monday’s SEC roundtable marked a turning point on how regulators characterize the Defi platform. Atkins explained that Defi reflects America’s economic values ​​and demonstrates institutional openness to the decentralized financial system. Although agents have not yet finalised their regulatory framework, recent actions show that developers and investors may soon act with legal clarity.

Also, recent guidance from SEC staff revealed that some common staking mechanisms do not violate existing securities laws. Additionally, the committee has removed certain long-standing enforcement cases involving crypto companies, indicating less hostile attitudes towards the sector.

Comprehensive regulations are still under development, but the SEC’s growing attitude has encouraged them to discuss possible market impacts. Investors and developers are currently anticipating changes that could improve compliance pathways and reduce legal uncertainty in the Defi protocol that operates in the US