SEC Commissioner Seeks Public Input on National Securities Exchange Trading of Crypto Assets

**SEC’s Peirce Seeks Input on Crypto Asset Trading Rules for Regulated Platforms** December 18 — On December 17, SEC Commissioner Hester Peirce released a statement alongside new FAQs from the Division of Trading and Markets, soliciting broad feedback on trading cryptographic (crypto) assets on National Securities Exchanges (NSEs) and Alternative Trading Systems (ATSs). The statement centers on trading and clearing arrangements for security and “security-non-security crypto asset” trading pairs. Peirce noted SEC staff are prepared to collaborate with market participants to enable compliant trading pairs on regulated platforms. She emphasized the market has a pressing need for clearer market structure rules to protect investors, maintain order, and avoid unnecessary regulatory burdens on innovation. Peirce specifically questioned whether 1998’s Regulation ATS and Regulation NMS are already outdated amid crypto assets and blockchain technology. Key feedback topics include: - How to reduce entry barriers for crypto asset securities and trading pair platforms to spur innovation - Whether current Reg NMS and Reg ATS impose disproportionate compliance costs on crypto trading - The need for a dedicated Form ATS for “Crypto ATS” or adjustments to the existing disclosure regime - Whether Crypto ATS disclosures should remain non-public or include SEC review/public disclosure - The relevance of retaining the Form ATS-R quarterly reporting requirement with blockchain/on-chain traceable data - The need for a compliant method to convert non-dollar assets to U.S. dollars - How to address trade information confidentiality, system risk controls (Rule 15c3-5), and Reg SCI system compliance requirements - How to avoid hindering individual software development, automated trading, or decentralized trading via regulation Peirce stressed these issues will inform the SEC’s Crypto Working Group’s subsequent policy development. Regulators also welcome broader suggestions to improve the overall regulatory framework for NSEs and ATSs. The market views the statement as another signal of relative openness within the SEC toward structural reforms for crypto asset trading.