In a move that’s already stirring the crypto community, U.S. SEC Commissioner Paul Atkins has publicly endorsed DeFi as aligned with the “core values of the American spirit”, including liberty, innovation, and private property rights. Speaking at the agency’s roundtable titled “DeFi and the American Spirit”, Atkins outlined a dramatic shift in tone from prior administrations—one that could open the door to real regulatory clarity and innovation in on-chain finance.
The SEC’s updated stance doesn’t just carry symbolic weight. It suggests real change may be coming in how decentralized networks, staking, and crypto self-custody are treated under U.S. law.
From Resistance to Recognition: A Turning Point for DeFi
For years, the relationship between U.S. regulators and the DeFi space has been tense. Lawsuits, unclear policies, and threats of enforcement created an atmosphere where builders were often discouraged from operating on American soil.
But Atkins made it clear: those days might be coming to an end.
“The American values of economic liberty, private property rights, and innovation are in the DNA of the DeFi movement.”
— Paul Atkins, SEC Commissioner
His remarks also pointed fingers at the previous administration, which—according to Atkins—discouraged Americans from participating in blockchains by casting validators and staking providers as potential securities law violators.
Now, Atkins is charting a different course. He acknowledged that voluntary participation in networks as validators or staking providers should not fall under federal securities law, aligning the SEC’s internal guidance with the realities of permissionless blockchain activity.
Staking, Self-Custody, and On-Chain Code: A Regulatory Recalibration
One of the most important parts of Atkins’ speech was his clear support for self-custody and staking. Rather than seeing them as risks, he described these on-chain mechanisms as aligned with the goals of capital efficiency and disintermediation.
“I am in favor of affording greater flexibility to market participants to self-custody crypto assets, especially where intermediation imposes unnecessary costs.”
Atkins also praised on-chain software systems that function without traditional operators, noting their resilience during crises. He argued that many existing securities laws were written for a world of intermediaries and issuers, not for self-executing code.
The Innovation Exemption: A Potential Game-Changer for Crypto
Perhaps the most forward-looking part of Atkins’ vision is his proposal for an “innovation exemption.” This would be a conditional regulatory framework allowing projects to launch on-chain financial products under a set of predefined compliance conditions.
The goal? To encourage innovation within the U.S., rather than pushing it abroad.
“An innovation exemption could help fulfill President Trump’s vision to make America the ‘crypto capital of the planet.’”
Atkins has formally asked SEC staff to explore how such a framework could accelerate the entry of compliant crypto products into the market, enabling both registrants and non-registrants to operate legally with greater flexibility.
Final Thoughts: What This Means for DeFi and American Values
For a space long plagued by uncertainty, Paul Atkins’ remarks could mark the beginning of a new chapter. By framing DeFi as a natural extension of American economic values, the SEC is signaling a more constructive approach to crypto innovation.
While this is not yet formal regulation, it lays the groundwork for real change. If the proposed innovation exemption becomes reality, it could turn the U.S. into a global hub for DeFi, rather than just a skeptical observer.In a regulatory environment where nuance is rare, Atkins’ speech offers hope—and possibly, a future where builders no longer have to choose between compliance and decentralization.
