President’s Working Group on Digital Assets Issues Report
On January 23, 2025, the President issued an executive order entitled “Strengthening American Leaders in Digital Financial Technology” to promote U.S. leadership in the digital asset industry, which included repealing the prior administration’s digital asset policies and establishing a multi-agency working group on the digital assets market within the National Economic Council. On July 30, 2025, the working group issued a 166-page report that includes the following core recommendations related to the regulation of digital assets:
- Legislation and regulatory changes should be enacted to permit U.S. citizens and businesses to lawfully maintain custody of digital assets and use blockchain technologies without fear of prosecution.
- With the support of Congress, the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission should leverage their respective authorities to facilitate active trading of digital assets in the U.S. markets.
- Federal banking regulators should maintain technology-neutral policies that provide clarity and transparency regarding the use of banking services for digital assets and blockchain technology.
- In accordance with the Guiding and Establishing National Innovation for U.S. Stablecoins Act of 2025, or GENIUS Act, relevant U.S. agencies including the U.S. Treasury should promote the adoption of U.S. dollar-backed stablecoins and prioritize U.S. dollar dominance.
- U.S. law enforcement agencies should target only persons who use digital assets to conduct illegal activities such as illicit finance and terrorist activity.
- The Internal Revenue Service and Treasury should review and publish tax guidance that recognizes the unique characteristics of digital assets.
The report also acknowledges the following key steps the SEC has already taken to advance these recommendations:
- ending the enforcement-first approach of the prior SEC leadership;
- establishing the SEC Crypto Task Force led by SEC Commissioner Hester Pierce, engaging with market participants, and holding five public roundtables;
- rescinding Staff Accounting Bulletin No. 121, which required entities to recognize on their balance sheets a liability and corresponding asset for safeguarding crypto assets held for platform users;
- providing staff guidance on meme coins, stablecoins, and activities such as mining and staking;
- clarifying disclosure requirements for crypto-related offerings;
- withdrawing restrictive guidance on broker-dealer custody of digital assets;
- publishing guidance to provide clarity on broker-dealer obligations and transfer agent issues; and
- abandoning rule proposals of the prior SEC leadership related to crypto.
The working group also urges that establishing a regulatory framework and taxonomy that supports the custody and trading of digital assets remains critical. As a result, the working group recommends the SEC take the following immediate actions:
- establish exemptions and safe harbors from registration under Section 5 of the Securities Act of 1933 and other securities law requirements for transactions and sales of digital assets;
- provide relief from broker-dealer, exchange, and clearing agency registration requirements of the Securities Exchange Act of 1934 for decentralized finance service providers;
- amend Regulation ATS to develop a regulatory framework for trading of non-security digital assets; and
- provide guidance on custody of security digital assets under the Investment Company Act of 1940 and Investment Advisers Act of 1940.
SEC Launches Project Crypto
Immediately after the report was issued, SEC Chairman Paul Atkins launched “Project Crypto” on July 31, 2025, which is a broad series of initiatives directing the SEC to work with the Crypto Task Force to develop regulatory proposals based on the recommendations of the working group. Project Crypto is intended to, among other things:
- provide clear guidelines for the determination of whether a digital asset is a security or subject to an investment contract;
- establish a regulatory framework for the custody and trading of digital assets;
- develop tailored disclosure requirements, exemptions, and safe harbors for digital assets and transactions that are subject to securities laws;
- modernize custody requirements for intermediaries of digital assets to maximize investor choice on custody and trading;
- promote the use of decentralized finance and other on-chain software systems in the U.S. securities markets; and
- encourage innovators to penetrate the digital asset market using new technologies, services, and business models through the use of an innovation exemption.
SEC Crypto Task Force to Get on the Road for More Roundtables
For stakeholders interested in further discussing the impact of these recommendations and proposals on the digital asset market, the SEC announced on August 1, 2025, that the Crypto Task Force will be hosting another series of crypto roundtables from August to December in cities including Boston, Dallas, Chicago, Cleveland, and New York City. Stakeholders can submit written input on issues to the Crypto Task Force to be considered at the roundtables or request to join Commissioner Peirce at the roundtables by emailing crypto@sec.gov with the subject line “Crypto on the Road.”
Key Takeaways
It is clear that tailored crypto regulation is a high priority of the SEC and that the SEC is willing to move swiftly to advance the President and the working group’s mission. We expect further guidance and rulemaking from the SEC, likely at record speed, to implement the working group recommendations and Project Crypto.
