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WASHINGTON — The U.S. Securities and Exchange Commission (SEC) may consider offering temporary regulatory relief for crypto firms as it works to develop a long-term framework for digital asset oversight, acting Chair Mark Uyeda said Friday during the agency’s latest crypto regulation roundtable.

The proposal marks a potential turning point in the SEC’s stance toward blockchain innovation, following mounting industry criticism that current securities laws don’t adequately account for the unique structure of crypto markets, 24-hour trading, and tokenized financial products.

“While the commission works to develop a long-term solution to address these issues, a time-limited, conditional exemptive relief framework … could allow for greater innovation with blockchain technology within the United States in the near-term,” Uyeda told participants.

The SEC crypto regulation roundtable, part of a broader initiative by the agency’s Crypto Task Force, featured exchanges between securities law experts, industry leaders, and agency commissioners. The March roundtable focused on defining whether and when crypto assets constitute securities. This latest session zoomed in on tailoring federal oversight for emerging blockchain-driven business models.

Industry and Regulators Grapple With Structural Gaps

Panelists repeatedly stressed the mismatch between traditional U.S. financial regulation and decentralized crypto ecosystems. Systems for national securities exchanges and alternative trading platforms, they said, do not easily adapt to crypto intermediaries offering custody, execution, and clearing services under a single platform.

Uyeda acknowledged the challenge of applying centralized regulatory models to vertically integrated crypto businesses, which can perform multiple financial functions simultaneously. He argued that blockchain technology could offer greater transparency and efficiency for clearing and transfer functions, even if federal securities laws were never written with these tools in mind.

Calls for Unified Oversight and New Definitions

Tensions between the SEC and Commodity Futures Trading Commission (CFTC) also took center stage. Dave Lauer, founder of Urvin Finance and a leader with We the Investor, warned that regulatory fragmentation could leave key risks unaddressed.

“There’s so many interlinkages … it’s incumbent for these two agencies to work very closely together,” Lauer said.

But Richard Johnson, founder of Texture Capital, went further: “We need to stop pretending that it makes sense that it be two separate regulatory agencies. They should really be merged.”

Panelists also emphasized the challenges of monitoring global crypto markets, noting that most assets trade around the clock and across borders. The pace and volume of market data, they said, requires new surveillance tools and deeper international cooperation.

Caution From the SEC’s Democratic Commissioner

Commissioner Caroline Crenshaw, the agency’s lone Democrat, offered a more cautious take. She warned that vertical integration poses serious risks to investors — as shown by several crypto collapses over the past two years.

“Because many of these entities are not registered with any regulator,” Crenshaw said, “they do not comply with laws designed to minimize these risks and potential conflicts.”

She emphasized that crypto customers often have unclear rights regarding custody and redress, and noted that strong disclosures and guardrails for broker-dealers could help protect retail investors.

Regulatory Innovation vs. Decentralized Structures

Panelists agreed that a broader regulatory mindset shift is needed.

“If we’re thinking about a decentralized system fundamentally in cryptographic assets, it’s hard to impose our centralized mindset on that,” said Lauer.

The SEC is expected to hold additional roundtables as it considers how to reshape its rulebook in light of a rapidly evolving digital asset market. Whether temporary exemptions, clearer definitions, or a unified agency structure emerge remains to be seen — but Friday’s discussion signaled that crypto regulation reform is accelerating.