The current US securities regulatory framework is “not a viable option” for overseeing digital assets, according to Rodrigo Seira, special counsel at law firm Cooley LLP. Speaking at a House Committee hearing on 9 April, Seira criticised the Securities and Exchange Commission (SEC) for creating insurmountable barriers for crypto companies trying to comply with existing laws.
The hearing, titled American Innovation and the Future of Digital Assets: Aligning the U.S. Securities Laws for the Digital Age, brought together legal and industry experts, including Tiffany J. Smith of WilmerHale, Jake Werrett from Polygon, and Alexandra Thorn from the Center for American Progress.
Crypto Projects Can’t “Register and Survive”
In his opening remarks, Seira stated that the SEC’s current approach fails to meet its policy objectives. “The idea that crypto projects can come in and register with the SEC is demonstrably false,” he said. He acknowledged that crypto firms raising capital should be subject to regulation but argued the existing system makes compliance nearly impossible.
Congressman Bryan Steil addresses the hearing on April 9. Source: House Committee on Financial Services
“Virtually no crypto projects have successfully registered their tokens under federal securities laws and lived to tell the tale,” Seira told the committee. “Projects that tried to comply expended significant resources only to fail or remain trapped in regulatory uncertainty.”
He also pointed out that registering a token under current securities laws comes with the burdensome obligation to operate as a public reporting company—an impractical requirement for most digital asset initiatives.
Political Push for Modern Legislation
Committee Chair Bryan Steil, head of the Subcommittee on Digital Assets, Financial Technology, and Artificial Intelligence, admitted that the existing roadblocks stem from regulatory inertia during the Trump administration. However, he assured that steps are being taken to correct the course.
Last week, the House Financial Services Committee advanced the STABLE Act, designed to bring regulatory clarity to payment stablecoins linked to the US dollar or other fiat currencies. The Act sets guidelines for issuance and oversight.
A month earlier, the Senate Banking Committee passed the GENIUS Act, which would impose reserve requirements on stablecoin issuers and mandate compliance with Anti-Money Laundering (AML) regulations.
Push for Comprehensive Digital Asset Legislation
Steil emphasised that while stablecoin regulation is a start, the next crucial move is advancing broader legislation that defines a clear market structure for digital assets. “This is the second half of the agenda,” he said.
Source: Financial Services GOP
Representative Ro Khanna echoed this sentiment at a recent digital asset conference, stating he was confident that a comprehensive market structure bill would be passed into law this year. The goal is to clarify legal categories for digital assets and determine the jurisdiction of oversight agencies such as the SEC and the Commodity Futures Trading Commission (CFTC).
Industry Calls for a New Approach
Seira’s comments underscore a growing frustration among crypto industry leaders and legal experts who argue that outdated regulations are stifling innovation in the US digital asset space.
While acknowledging the need for investor protection, Seira and others argue that without meaningful regulatory reform, the US risks falling behind other nations in the race to lead the digital financial future.
