The SAC unveiled Project Crypto, a new initiative aimed at modernizing securities regulations to support crypto-based trading.
Now the move comes as interest in tokenization, the process of creating digital representations of securities or other assets on a blockchain continues to grow.
SEC chair Paul Atkins emphasized the need to avoid.
Size fits all rules that could force crypto companies to move offshore.
Joining me this morning is Kristen Smith, president of the Solana Policy Institute.
Good morning, Kristen.
Thank you so much for joining us from San Francisco this morning.
So it's been quite a busy year.
Each time we speak, there's a lot to catch up on.
But tell me first about your reaction to Project Crypto.
Well, good morning, Rey.
Yes, I think it's an incredibly exciting time in the crypto policy and regulatory world.
It seems like every couple of days we have a major development, but this speech by Paul Afkins that he gave last week where he announced Project Crypto is really one of the most ambitious reforms that we've seen the SEC undertake in decades.
And their goal is to go through the securities laws and update their guidance, their regulation to make sure that it is very, very clear rules of the road for bringing securities and other kinds of assets on chains.
So this is incredibly exciting if you think about the benefits of tokenization, I think one of the key benefits is the efficiency that it brings to the trading and issuance of equities and other types of securities, and this will allow for 24/7 trading, instant settlement, transparent ownership.
So this is very exciting, but there's certainly a lot of work that the SEC is going to need to do um in order for the full impact of Project crypto to be realized.
And I understand that the Salonna Policy Institute, along with other partners, submitted legal frameworks to the SEC's crypto task force as part of Project Open.
Now the group submitted a 20 plus page legal framework to the SEC's crypto task force, including registration pathways, KYC onboarding smart contract-based settlement, etc.
So walk me through how Project Open mirrors Project crypto.
Yeah, I mean, we were very excited that the two proposals are very similar.
One of the things that we've been trying to do is work with different players across the Salana ecosystem and figure out what are the regulatory barriers and potential solutions, and I really have to give credit to the SEC's. task force, you can go to their website.
You can see the list of all of the meetings they've had over 150 meetings since the start of the year with different stakeholders, and you can see the proposals that people are suggesting.
And so, you know, I think from where we stand with Project Dopa there isn't necessarily one right way to do it, but there are a lot of different tools. available to the SEC, whether it be rulemaking or guidance or exemptive relief that they can use that make it easier to pave the way for this type of technology.
And so yeah, when we, when we saw the announcement at Slana Policy Institute about Project crypto we thought wow, that looks a lot like Project Open and we were really excited to see the SEC move forward.
And Kristen, the White House released its first policy roadmap from the president's working group on digital asset markets.
The report does signal a shift from if to how crypto will integrate into the financial system.
So what is the SPI's response?
Yeah, well, I think we've been particularly excited by what the White House has done across the board, and I think what we saw with SEC's Project Crypto, that announcement came the day after the White House's President's Working Group released its report.
If you remember, Remy, at the beginning of the year, the president issued an executive order where he tasked the heads of the relevant agencies to work on this report.
It's over 180 pages long and it lays out a lot of the policy issues and then proposes very specific.
Solutions and what's really cool about the report is it talks about who has to do what.
It says, all right, we need Congress to address certain pieces.
We need the SEC to do this piece, the CFTC, and it really puts a blueprint in place for how the US can become the crypto capital of the world.
And so we were particularly excited by the report's acknowledgement that DFI is different than CFI.
It was very clear on what they think the role of the SEC should be and the CSI.
TC should be their tax solutions and then a lot of really great language about ensuring that Operation Choke Point can't return.
And so it's, you know, if I look back over the past 6 months, it's remarkable how much the administrative agencies have been able to do to welcome crypto innovation in the United States, and this report lays out the final steps that are needed to make that permanent and enshrined innovation policy all across the federal government for decades to come.
OK, Kristen, well, we will have to leave it there for today, but as always, it's great talking with you.
Thank you so much for joining us this morning and thank you so much for sharing your perspectives as well as insights.
Thanks, Rey.
