SEC Unveils Strategy for Regulating Cryptocurrencies

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The United States Securities and Exchange Commission (SEC) is preparing a sweeping overhaul of capital markets regulations to address the growing role of cryptocurrencies and blockchain-based trading systems.

In a recent announcement, SEC Chair Gary Gensler confirmed that the commission is developing formal guidance on how and when digital tokens should be classified as securities under U.S. law. The move signals a shift in how American regulators are handling digital assets and may influence other markets, including Australia’s.

Gensler has directed SEC staff to establish a framework that clarifies classification, registration, and disclosure requirements for firms dealing in cryptocurrencies. Proposed updates include exemptions and tailored disclosures specific to blockchain-based financial products.

“This initiative is about bringing clarity and consistency to an area that has long operated in regulatory grey zones,” Gensler said during a press briefing. “The goal is to encourage responsible innovation while ensuring adequate investor protection.”

The announcement comes amid rising global demand for clearer crypto regulation, as both retail and institutional adoption expand. In Australia, the Australian Securities and Investments Commission (ASIC) and the Reserve Bank of Australia continue to monitor developments in the crypto space, although formal regulation remains limited.

Industry figures welcomed the SEC’s move, noting it could help restore market confidence and offer clearer pathways for compliance. Blockchain firms and trading platforms have raised concerns that outdated regulatory frameworks have stifled innovation and increased exposure to enforcement actions.

The proposed reforms will be subject to stakeholder consultations and a public comment period before final rules are enacted. While aimed at the U.S. market, the SEC’s decisions are closely watched by international regulators.

Cryptocurrency remains a high-risk, volatile asset class. However, analysts suggest that increased regulatory clarity could broaden participation and strengthen the legitimacy of blockchain-based finance.

The SEC’s full proposal is expected later this year.