Congratulations, digital wallet users: the SEC just decided you don’t need protection. No net capital requirement, no customer protection rule, no mandatory cybersecurity, no examination, no books and records, no SIPC coverage, and no FINRA arbitration when something goes wrong. And when you lose everything — to a hack, a fraud, a pig butchering scam, an approval phishing attack — there is, as the FBI itself puts it, “usually nothing the victim can do.”
The courts that spent a decade affirming that digital asset platforms must register? Still there. The securities laws? Unchanged. The SEC warned you about digital wallets in 2018. In 2026, it forgot.
In an ironic scene that will go down in history, SEC Chairman Paul Atkins stood before a cheering crypto crowd and declared: “We’re not the Securities and Everything Commission anymore.” This left me wondering: Will there ever come a day when the SEC is not announcing what they will not do? (Apologies for the double-negative)
Source: John Reed Stark on LinkedIn