The American Commission for Securities and Exchange has long been the most influential financial regulator in the world, helping to ensure that our capital markets are the deepest, the fairest and the most accessible in the world. But its continuous relevance will depend on the question of whether it can make more than simply respond to innovation – it must promote it proactively.
For almost a century, the SEC has adapted to evolution markets, new technologies and more detail participation. In its best moments, the agency adopted innovation in the transparency service, investor protection and capital training. But in recent years, he has moved away from this heritage – nowhere more visibly than in his approach to crypto and blockchain.
Tuongvy is a speaker at the 2025 consensus in Toronto from May 14 to 16.
The good news is that, with a change in leadership and a more open -emerging posture, the dry has the possibility of correcting the courses. But the biggest question is: how to make this change permanent? How can we integrate innovation into dry DNA so that the next promising financial technology is not strangled in its cradle?
I spent nearly six years at the SEC, first as main advisor in the application division, then as chief advisor at the Office of Legislative and Intergovernmental Affairs. Since then, I have held legal and political management positions in cryptographic companies through the ecosystem. From the point of view, one thing is clear: the dry can fulfill its mission more effectively – and maintain its world leadership – only if it becomes a proactive partner in financial innovation.
The dry to its best
The dry has a proud history of embracing change in favor of investors and markets. In the 1990s, he scanned business documents via Edgar, replacing paper documents by consultable databases. He then approved the ATS regulations, allowing the rise in alternative trading systems that increased competition and liquidity. The FNB, which were once new, are now traditional products which offer exposure at low cost and diversified to a wide range of assets. More recently, trading in fractional sharing has enabled the millions of retail investors to have a tranche of companies that they could only admire it from afar.
A particularly relevant example, because the dry reflects on how to regulate the crypto is the processing by the agency of securities backed by assets. In the 1980s and 1990s, the SEC recognized that these complex financial products did not adapt perfectly to existing disclosure regimes. After years of study and letters of non -action, he developed a tailor -made disclosure framework in 2004 – refined more in 2014 – which balanced innovation with the protection of investors. And he didn’t need to bring hundreds of application measures to do so.
When the dry has been late
There are also moments when the dry has failed to adapt, to the detriment of investors and markets. It was slow to respond to the rise in high frequency trading, contributing to the 2010 flash accident. It took years to implement the crowdfunding rules authorized by the law on jobs. It has been delayed in digital report standards, delaying wider access to market data.
And, for a large part of the past few years, his position on the crypto has gone from prudence to outright hostility. Instead of issuing clear rules for digital assets, the agency continued a dispersion application campaign – often against companies that sought to comply in good faith. Many of these actions did not even involve fraud or loss of investors. Meanwhile, American crypto companies fled abroad and a global industry has prospered without us.
Even the reluctant approval of the FNB Bitcoin FNB in 2024 only occurred after being forced by a federal court. And while the agency spoke at a given time to create a framework for the disclosure of cryptography similar to what it has done for ABS, it has never followed.
Innovation is not the enemy
The crypto can be new, but the dry has already faced this challenge before. He knows how to modernize his rules to respect new realities. What is different now is an opportunity to take advantage of innovation – not just to regulate it.
Take blockchain technology. It could allow close instant commercial regulations, reduce risks and release capital. It could improve market transparency through immutable records and real -time transaction data. It could reduce operational costs by reducing intermediaries. And tokenization could extend access to private markets and difficult to access assets, benefiting both to issuers and investors.
Ironically, the dry has not seriously explored how blockchain could improve its own market surveillance. It is a missed opportunity. But it is not too late.
A plan for the future
So what would it look like to integrate innovation into the main dry mission?
- Revise the mandate of the dry: Congress should modify the EXCHANGE ACT SECURITIES of 1934 to explicitly include promoting innovation and modernization, alongside investor protection, market integrity and capital training.
- Rethink the metrics of success: SEC should not measure success only by the number of application measures or collected penalties. He should also turn to capital training, investor confidence and the adoption of new technologies.
- Create an innovation office: A devoted and authorized team should engage with entrepreneurs, technologists and academics to guide responsible innovation – as well as offices similar to the United Kingdom and Singapore have done so.
- Adopt risk -based regulations: All new products or platforms do not need complete regulatory treatment on the first day. Pilot programs, safe ports and regulatory sand stores can help innovators test ideas while maintaining appropriate railings.
- Invest in education and training: SEC staff need better control of emerging technologies. Interdisciplinary expertise must be rewarded and cultivated.
These are not radical ideas – these are proven tools drawn from the own dry manual.
In a global race to define the future of finance, the dry has the choice: lead or late. Its greatest strength has always been its credibility and its ability to adapt.
The next generation of investors and entrepreneurs will not expect the rules of the 20th century to catch up with the 21st century innovation. They shouldn’t either. If the dry wants to remain the gold stallion, it must adapt again – not only to the present day, but to what comes next.
