The US Securities and Exchange Commission (SEC) is considering abandoning its plans to require certain crypto firms to register as exchanges, according to Acting Chairman Mark Uyeda.

Another Crypto-Friendly Move by the SEC

Speaking at the Washington Conference of the Institute of International Bankers yesterday (Monday), Uyeda revealed that he has already “asked SEC staff for options on abandoning” parts of the proposed changes that would broaden the definition of alternative trading systems (ATSs) to include crypto exchanges.

“In light of the significant negative public comments received on the definition of ‘exchange’ with respect to crypto, I have asked SEC staff for options on abandoning that part of the proposal,” Uyeda stated.

“In my view, it was a mistake for the Commission to link regulation of the Treasury markets with a heavy-handed attempt to clamp down on the crypto market,” he added.

Uyeda took over as the SEC’s acting chair following Gary Gensler’s resignation. However, former SEC Commissioner Paul Atkins has been nominated for the role by Donald Trump, with his confirmation now pending Senate approval. Both Uyeda and Atkins are considered crypto-friendly, in contrast to Gensler, who initiated several high-profile enforcement actions against crypto firms.

Rolling Back Gensler’s Policies

Uyeda noted that the initial proposal to amend ATS rules was introduced in 2020 under former SEC Chair Jay Clayton. However, in 2022, under Gensler’s leadership, the agency expanded the proposal to categorise certain crypto firms under the ATS framework. The move drew criticism from the industry, as it would have subjected these firms to heightened regulatory scrutiny and additional compliance requirements.

“Rather than focusing on the narrow issues related to Government Securities ATSs, a new iteration of the rule was proposed in 2022 that would redefine the regulatory definition of an exchange,” Uyeda explained.

“The revised definition included ‘communications protocols’ without clearly defining the term,” he added. “This vastly expanded definition of an exchange would have encompassed various protocols used for crypto assets.”

Meanwhile, the SEC has already reversed several enforcement actions initiated under Gensler’s tenure. The regulator has dropped lawsuits against Coinbase and Kraken while also halting proceedings against Binance.

Source: Finance Magnates