The U.S. Securities and Exchange Commission (SEC) has withdrawn crypto custody rules initiated under former chair Gary Gensler. This change under current chair Paul Atkins may enhance market conditions in the cryptocurrency industry.
Regulatory Shift
The withdrawal of SEC proposals reflects a shift in regulatory strategy, previously marked by stringent oversight. The crypto industry anticipates reduced uncertainty and increased institutional participation, boosting market confidence.
Response to Rule Changes
Changes led by Chair Paul Atkins suggest a favorable stance towards self-custody and DeFi principles. Coinbase's Paul Grewal welcomed the policy reversal, noting that 'down goes 3b16, qualified custodian, and all the other unfinished Gensler rule proposals' indicates a positive shift in policy.
Potential Market Consequences
The rule withdrawal could lead to growth in DeFi sectors, encouraging innovation. Optimism within the crypto sphere grows as investor risk lessens. The SEC's decision brings potential benefits to government, market, and communities, indicating a more welcoming U.S. regulatory environment.
The SEC's regulatory shift may positively impact the market and stimulate the development of new financial products, fostering a supportive regulatory framework.
