SEC Pulls Gensler-Era DeFi Reporting Rules as Atkins Calls for Innovative Exemption

Key Takeaways

• The SEC has withdrawn controversial DeFi and custody proposals introduced under former Chair Gary Gensler.
• The scrapped rules would have subjected DeFi platforms to the same registration requirements as traditional exchanges.
• Current SEC Chair Paul Atkins signaled support for a more tailored approach to DeFi regulation.

The U.S. Securities and Exchange Commission (SEC) has formally withdrawn a set of regulatory proposals aimed at decentralized finance (DeFi), signaling a broader policy pivot under the Trump administration.

SEC Pulls Gensler-Era DeFi Rules in Major Shift Under Trump

In a notice published Thursday, the SEC announced it would no longer pursue amendments that would have redefined securities exchange rules to include DeFi platforms.

The now-scrapped rules had sparked widespread backlash from crypto developers and policy groups, who argued they were unworkable for decentralized protocols.

The proposals would have forced DeFi platforms to register with the SEC under the same framework used for centralized trading venues, raising questions about how decentralized systems could even comply.

The agency also dropped a separate proposal that would have imposed stricter custody requirements on crypto platforms, another measure that critics said unfairly targeted decentralized applications.

Trump-Era SEC Takes Softer Line on Crypto

Since President Donald Trump returned to office, the rollback follows a broader shift in the SEC’s posture toward crypto markets.

Under Chair Paul Atkins, the commission has stepped back from aggressive enforcement and taken steps to ease compliance burdens.

Atkins, who has advocated for an “innovation-first” approach, recently indicated that DeFi platforms deserve a regulatory framework that acknowledges their structural differences from traditional financial intermediaries.

This marks the second major reversal of Gensler-era policy in recent months.

The SEC previously rescinded Staff Accounting Bulletin 121 (SAB121), a controversial rule that limited how banks and public companies could handle crypto custody.

Lawmakers are also moving quickly to codify new crypto frameworks. The CLARITY Act, aimed at defining agency roles, and the GENIUS Act, which focuses on stablecoins, are both nearing final votes in Congress.