SEC Chair Nominee Atkins Says Crypto Regulation His 'Top Priority' — Barrons.com

By Kenneth CorbinPaul Atkins, President Donald Trump's nominee to chair the Securities and Exchange Commission, says his "top priority" in that role would be establishing a new framework for cryptocurrency regulation."I've seen how ambiguous and nonexistent regulation of digital assets create uncertainty in the market and inhibit innovation," Atkins said Thursday in his opening statement at his confirmation hearing before a Senate committee."The top priority of my chairmanship will be to work with my fellow commissioners and Congress to provide a firm regulatory foundation for digital assets through a rational, coherent, and principled approach," he said.Atkins is no stranger to the agency he is on tap to lead, having served as a commissioner from 2002 through 2008 and previously worked as a staffer to two SEC chairmen.During his confirmation hearing, however, he reminded lawmakers that he has been out of the agency for nearly two decades and declined to make firm commitments about how he would handle specific matters before the current commission, including the probe into Elon Musk's purchase of Twitter and the prospect of dramatically reducing the SEC workforce.Sen. Angela Alsobrooks (D., Md.) pressed that point when she asked Atkins whether he would "commit to not allowing any political influence from the White House or the Department of Government Efficiency on the SEC's supervisory and enforcement decisions against companies.""I think we should call the shots as they are," Atkins said, but downplayed the prospect of political interference in the SEC's operations. "I just don't think there will be any when I'm chair."Atkins, who was acknowledged as a contributor to Project 2025, the policy blueprint for a second Trump term drafted by The Heritage Foundation, sought to minimize his involvement in that effort, saying he "participated in a couple of phone calls." He declined to endorse the document's call to eliminate the Public Company Accounting Oversight Board and fold its role into the SEC, saying that such a move would be up to Congress. Project 2025 similarly called for the abolition of Finra, the brokerage industry's self-regulatory organization.Atkins offered no major regulatory proposals to address market deficiencies, and seemed resistant to calls to increase oversight of private funds when asked whether he was concerned about those vehicles gaining greater exposure to retail investors through exchange-traded funds, potentially coming with higher fees, limited disclosures, and managers' conflicts of interest.Atkins argued that private funds are mostly geared for wealthy, sophisticated investors who meet the "accredited investor" definition, and less-affluent consumers "don't necessarily need to invest in those types of instruments." Moreover, he said, the diversification requirements built into mutual funds and ETFs are an important investor protection "so that one bet or one investment won't take the whole thing down."Still, he noted that the truth-in-advertising requirement to make accurate disclosures "applies whether or not it's a public security," suggesting that if fund managers or offering companies make false or misleading statements the commission would investigate and potentially bring an enforcement action. "If the disclosures are materially incorrect, that's actionable," he said.Atkins also endorsed the spirit of the long-running Republican campaign to stamp out considerations from the investing process that critics say are extraneous and politically motivated, such as a company's environmental risks or the social impact of its activities."I want to get politics out of the financial markets and out of how the SEC interacts with the financial markets, and unfortunately there were some out there who are using other people's money to try to influence corporations through the distortions of the corporate governance process, " he said. "That will end, and we will have protections in place so that money managers and others will be focused on actual investment strategy and not on politics."Write to [email protected] content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.