Key Takeaways from the SEC’s Third Crypto Roundtable

TLDR

• The latest SEC crypto roundtable was on April 25th, 2025.
• Speakers Paul Atkins, Hester Peirce, and Caroline Crenshaw had insights as well as questions.
• Under the current administration, the SEC has many challenges ahead of it, but it is actively laying the groundwork for clear regulation regarding digital assets.

The recent SEC crypto roundtable illuminated significant challenges and conversations around the regulation of crypto assets, with a specific focus on custody issues. For anyone navigating the complexities of crypto, the discussion brought forward a mix of optimism, challenges, and calls to action for clearer regulatory frameworks. 

Here’s a breakdown of the highlights from the event, including insights from key speakers. Let’s get after it.

Paul Atkins, Chairman, on the Need for Clear Rules

Paul Atkins opened the panel with a clear emphasis on innovation and regulatory clarity. He highlighted the importance of blockchain technology, not just as a hype cycle, but as a genuine tool for financial modernization.

According to Atkins, “Entrepreneurs across the United States are harnessing blockchain technology to modernize aspects of our financial system.” However, the lack of clear regulatory “rules of the road” has stifled innovation. His statement reflects frustrations felt across the crypto community where uncertainty limits growth and adoption.

A central point of his address tackled the custody of crypto assets. Are existing SEC regulatory frameworks like the Exchange Act and Advisers Act sufficient for modern crypto assets? Or do these laws need updates tailored to the nuances of blockchain and crypto technology? 

Atkins left the audience with a clear challenge to the market and regulators, urging collaboration to decide whether a new crypto asset broker-dealer framework is necessary to meet the needs of the rapidly evolving digital landscape. 

Hester Peirce (“Cryptomom”) Calls for a Brighter Path Forward 

Commissioner Hester Peirce, frequently referred to as “Cryptomom,” took a more vivid and creative approach during her speech. She likened the current regulatory environment to a game of “the floor is lava”, where crypto companies are forced to jump between murky and often contradictory regulatory guidelines, hoping not to get burned. 

Peirce argued that this unclear regulatory landscape makes it difficult for brokers and alternative trading systems (ATS) to hold crypto assets or facilitate their trading. This lack of clarity ultimately hinders the development of robust and trustworthy crypto markets.

She also pushed back against a one-size-fits-all regulatory approach for crypto custody. Peirce pointed out that some forms of self-custody or blockchain protocols, such as smart contracts, can mitigate traditional risks and enable decentralized ownership structures. 

Her overarching message? “It’s time to turn on the lights and build walkways over the lava pit.” Peirce made it clear that innovation and investor protection are not mutually exclusive, and the SEC needs to foster policies that recognize the unique attributes of crypto while still safeguarding users. 

Caroline Crenshaw Explores Crypto Custody Through the Lens of Trust 

Commissioner Caroline Crenshaw struck a different tone, grounding her speech in trust as the foundation of the SEC’s custody rules. Comparing financial custody to entrusting airlines with luggage, she underscored the need for clear standards and accountability to ensure client assets are protected.

“What basic standards should we apply to ensure custodians can be trusted?” Crenshaw asked, turning the spotlight on whether crypto’s distinct characteristics deserve an entirely different custody framework. She pushed back against ad hoc exemptions, warning that they could weaken investor protection. 

Crenshaw cautioned that while crypto enables unique technological features, it also brings significant risks that regulators and custodians must address. The ultimate goal, she emphasized, should be ensuring asset safety through proper checks and balances.

Key Questions Raised During the Roundtable 

The roundtable sparked a number of pivotal discussions about crypto custody and broader regulatory challenges. Some of the key questions explored included:

• Should existing custody rules under the Exchange Act and Advisers Act be adapted to address crypto assets specifically?
• Can the current “special purpose broker-dealer” regime adequately address crypto custodianship, or do we need an entirely new framework?
• What unique risks do crypto assets present to custodians, and how can regulations balance innovation with investor protection?
• Should self-custody solutions play a larger role in crypto markets, or is intermediation still necessary to ensure safety and accountability?

Why Regulation Matters to the Crypto Community 

The SEC roundtable represents more than regulatory debate for crypto enthusiasts and new users. It’s a critical moment for shaping the future of cryptocurrency adoption in the US. A lack of clear guidelines has held back innovation and even driven some blockchain projects abroad.

However, the roundtable highlighted a growing recognition of crypto’s potential to modernize financial systems, reduce costs, enhance transparency, and offer new ways for individuals to manage assets. 

Achieving these benefits will require cooperation between regulators, market participants, and technology innovators.

Much-Needed Crypto Regulation Is Coming 

All eyes are now on the SEC as users and the industry await actionable steps from the discussions. The pressing need for clarity on crypto custody, broker-dealer frameworks, and investor protections means the crypto community will be watching closely for concrete recommendations.

For now, users in the crypto space can take comfort in knowing that key advocates like Hester Peirce are fighting to ensure innovation isn’t stifled and that a balanced regulatory framework can be achieved. 

If you’re new to crypto or looking to deepen your understanding of how custody rules might impact your trading or investments, stay informed and keep your eyes on Dypto Crypto News.