Wall Street Regulators Team Up on Cryptocurrency Oversight

The SEC and CFTC are taking steps to harmonize their approach to regulating cryptocurrency. In a bid to provide regulatory clarity, the two agencies have signed an interagency agreement that outlines a 'fit-for-purpose regulatory framework' for crypto assets.

According to Paul Atkins, Chairman of the SEC, this move is part of a new era of 'regulatory coherence.' The agencies will work together on rulemaking, examination, and enforcement, which should reduce duplicative or conflicting standards and litigation risk for crypto companies. This development is expected to benefit dual registrants, industry players, and others that have found themselves subject to overlapping regulations.

The agreement also includes a 'token taxonomy' from both regulators defining which types of digital assets each will oversee. The SEC has abandoned the Biden administration's bid to police digital tokens for registration failures, an approach criticized by Trump-era officials and the crypto industry as 'regulation by enforcement.'