In a significant policy shift, SEC Chairman Paul Atkins has signaled strong support for decentralized finance (DeFi) and cryptocurrency self-custody, marking a dramatic departure from previous regulatory approaches. Speaking at the “DeFi and the American Spirit” roundtable on June 9, 2025, Atkins outlined a vision that positions DeFi as aligned with core American values and announced plans for an “innovation exemption” framework to accelerate blockchain development .
A Regulatory Breakthrough for Crypto
Atkins directly criticized the previous administration’s approach to cryptocurrency regulation, which he characterized as discouraging American participation through excessive enforcement actions . “The prior U.S. government administration discouraged Americans from participating in these market-based systems by asserting through lawsuits, speeches, regulation, and threatened regulatory action that participants and staking-as-a-service providers may be engaged in securities transactions,” Atkins stated during the roundtable.
The SEC chair has now directed agency staff to develop a conditional exemption framework specifically designed to allow both registered and non-registered entities to bring on-chain products and services to market more efficiently . This “innovation exemption” represents a fundamental shift in regulatory philosophy from enforcement to enablement.
Self-Custody as an American Value
In his remarks, Atkins emphasized the importance of self-custody in the cryptocurrency ecosystem, describing it as a “foundational American value” . He expressed support for “affording greater flexibility to market participants to self-custody crypto assets, especially where intermediation imposes unnecessary transaction costs or restricts the ability to engage in staking and other on-chain activities.”
This position stands in stark contrast to previous regulatory actions against self-custodial digital wallet providers like MetaMask, which faced legal challenges under the prior administration. Atkins specifically criticized these actions, stating that they “undermined innovation in self-custodial digital wallets and other onchain technologies” .
Implications for Ethereum and DeFi
The regulatory shift has significant implications for the entire cryptocurrency ecosystem, but Ethereum may be particularly well-positioned to benefit. As the home and pioneer of DeFi, Ethereum could gain substantial regulatory clarity for staking, self-custody, and open-source infrastructure development .
Industry reaction has been overwhelmingly positive. Uniswap founder Hayden Adams remarked on the rapid evolution of DeFi’s standing, noting it’s “insane how far DeFi has come so quickly. Now, government agencies publicly recognize it as a national priority.”
Ethereum experienced a 5% price surge following Atkins’ comments, though this may have been partially influenced by Bitcoin testing the $110,000 level. More tellingly, the DeFi sector as a whole outperformed other cryptocurrency segments by approximately 5%, suggesting investors recognize the potential impact of these regulatory changes .
From Enforcement to Innovation
The philosophical shift at the SEC represents a complete reversal from the previous “regulation by enforcement” strategy that created significant legal uncertainty for crypto developers and platforms . Atkins has explicitly addressed one of the industry’s most persistent concerns by clarifying that mining, validating, and staking-as-a-service operations should not fall under federal securities laws .
This new approach aligns with the current administration’s stated goal of making America the “crypto capital of the world” through supportive regulatory frameworks rather than punitive enforcement actions .
Industry Response
The crypto industry has responded enthusiastically to Atkins’ statements. Beyond Hayden Adams’ comments, other industry figures like Eric Conner have highlighted the potential benefits for Ethereum specifically: “If this becomes policy… Ethereum gets regulatory clarity for staking, self-custody, and open-source infra. The tide is turning. Let’s build.”
The market response suggests investors share this optimism, with DeFi tokens showing particularly strong performance following the announcement .
