Washington Crypto Update
May 11, 2026
SEC Chairman Paul Atkins signaled a major shift toward a more accommodating and formal regulatory framework for the cryptocurrency industry, moving away from the enforcement-heavy approach and focusing specifically on blockchain’s integration into financial markets, Atkins called for formal “notice-and-comment” rulemaking to update and clarify how legacy legal definitions such as “exchange,” “broker,” and “clearing agency” to apply to DeFi protocols and on-chain trading systems.
He emphasized that the SEC should provide regulatory flexibility and “fit-for-purpose” architectures, like the 1990s framework for electronic trading and urged Congress to pass the CLARITY Act to provide long-term legislative certainty. Senators Thom Tillis and Angela Brooks finalized a compromise to settle one of the Clarity Act’s most contentious disputes, prohibiting crypto firms from offering yield on stablecoin balances equivalent to bank deposit interest while still allowing rewards tied to actual platform activity. The text also directs regulators to propose a new series of stablecoin regulations, including development of a disclosure regime and a list of permissible rewards. Market reaction was broadly positive with a Coinbase executive remarking that while banks secured tighter restrictions on passive rewards, the industry protected what matters most: the ability for users to earn rewards through real usage of crypto platforms and networks.
The DTCC confirmed that it will begin facilitating limited production trades of tokenized securities in July, with a full launch planned for October. The development comes after the DTC received a no-action letter from the SEC in Dec-25, approving its defined tokenization service for three years.
The White House is preparing a major update to its Strategic Bitcoin Reserve policy within weeks, according to crypto adviser Patrick Witt. The reserve, created by a 2025 executive order, currently consists mainly of Bitcoin seized through forfeitures and is intended to be treated as a long-term national reserve asset rather than sold. Officials are reportedly finalizing the legal and operational framework for custody and management, while Congress works on legislation that could formally codify the reserve and potentially authorize large-scale future Bitcoin acquisitions.
