**SEC Acting Chair Proposes Regulatory Sandbox for Crypto Trading**
The acting chairman of the Securities and Exchange Commission (SEC), Mark Uyeda, has proposed creating a conditional regulatory sandbox to advance blockchain-based securities trading. Speaking at the SEC Crypto Task Force’s roundtable on April 11, Uyeda suggested a temporary, conditional framework to foster innovation, allowing both registered and unregistered entities to test blockchain solutions without full regulatory approval, provided they meet specific conditions. He encouraged input from market participants on how this relief could be best implemented.
Uyeda recognized that early digital asset trading platforms operated mainly outside federal oversight under state-level regulation, requiring multiple licenses to operate nationally. He proposed a federal regulatory framework to simplify compliance for platforms trading both tokenized securities and non-security digital assets. However, he noted that current federal securities laws pose challenges to integrating blockchain with traditional markets, citing limitations for broker-dealers and exchanges.
He pointed out that most tokenized securities are unregistered and cannot be listed on national exchanges, with the structural differences between traditional and crypto platforms adding complexity. While traditional exchanges separate functions like custody and execution, many crypto platforms combine them. Uyeda acknowledged that federal laws did not foresee technologies like blockchain or smart contracts, but he highlighted the operational benefits of distributed ledger technology, including real-time collateral management and continuous trading.
