Securities On A Sliding Scale: Inside "Project Crypto's" New Approach To Digital Assets

On November 12, 2025, Securities and Exchange Commission ("SEC") Chairman Paul S. Atkins spoke at the Federal Reserve Bank of Philadelphia regarding the SEC's "Project Crypto" initiative, which aims to create a clear and robust crypto asset regulatory framework to foster innovation, protect investors, increase capital formation, and bring crypto projects back onshore from foreign jurisdictions.

In his recent speech, Chairman Atkins sought to address the continued uncertainty over whether crypto assets are securities, emphasizing that: (i) most crypto assets are not securities, but some crypto assets are one part of investment contracts that are securities; (ii) the longstanding legal analysis under the Howey test will be maintained to focus on substance over form; and (iii) the security status of crypto assets may change as the facts and circumstances of the related investment contracts evolve. Chairman Atkins also expressed support for recent legislative efforts