SEC Eyes New Rules for Onchain Markets as AI Finance Accelerates

What Happened: SEC Signals Rulemaking for Onchain Markets

SEC Chair Paul Atkins announced the agency is considering new rulemaking for onchain trading systems, crypto vaults, and blockchain settlement infrastructure, driven by the rise of AI-powered finance. Atkins argued that existing securities regulations do not fit blockchain protocols that combine multiple market functions into a single software, and emphasized the need for formal rulemaking rather than enforcement to clarify how the SEC views hybrid traditional-decentralized market models. This marks a pivot from the enforcement-heavy approach under former Chair Gary Gensler.

Atkins framed the move as part of a broader shift to AI-driven automated finance, where AI agents will participate in markets at machine speed and blockchain rails enable instant value movement. He also supported congressional efforts like the Digital Asset Market Clarity Act (Clarity Act) to establish a regulatory framework for digital assets shared between the SEC and CFTC.

Connection to Other Regulatory Moves: Clarity Act and GENIUS Act

The Senate Banking Committee has scheduled a markup hearing for the Digital Asset Market Clarity Act of 2025 on May 14, 2026, a key step toward establishing a federal regulatory framework for digital assets. The bill had stalled since January due to disagreements over stablecoin yield provisions. A compromise brokered by Senators Tillis and Alsobrooks would prohibit yield on static stablecoin reserves but allow rewards for actively used stablecoins. Banking trade associations (ABA, BPI, ICBA) have requested additional edits, and Senator Gillibrand has called for an ethics provision barring senior officials from profiting from the crypto industry.

Meanwhile, the GENIUS Act stablecoin framework has provided regulatory clarity that executives at Consensus Miami 2026 called a 'permission slip' for traditional finance firms to enter the stablecoin market. MoonPay's Richard Harrison noted that stablecoins could reach 10% of global remittances within five years, with B2B payments as a clear use case, while consumer adoption lags due to infrastructure gaps. Ripple's Jack McDonald emphasized that institutional adoption requires regulated products, trusted counterparties, and custody arrangements.

What Compliance Teams Should Prepare For

With the SEC moving toward formal rulemaking for onchain trading and settlement, and Congress advancing the Clarity Act and GENIUS Act, compliance teams should prepare for:

• AML/KYC requirements for onchain intermediaries: New rules may impose transaction monitoring and suspicious activity reporting (SAR) obligations on blockchain-based trading systems and crypto vaults.
• AI governance for automated finance: As AI agents execute trades at machine speed, firms must ensure compliance with existing AI governance frameworks, including the EU AI Act and emerging US state AI laws like the Colorado AI Act and NYC Local Law 144.
• Stablecoin reserves and reporting: The GENIUS Act's compromise on yield and reserves will require stablecoin issuers to implement robust compliance reporting and audit trails.
• Cross-agency coordination: The Clarity Act envisions a joint SEC-CFTC framework, meaning firms may need to comply with both agencies' rules.

How AIGovHub and RisksRadarAI Can Help

Monitoring these rapidly evolving regulations across SEC, Congress, and state levels is a challenge. AIGovHub provides a central regulatory intelligence platform with automated alerts matched to your company profile across 47+ jurisdictions, covering AI governance, fintech, AML, and cybersecurity. Interactive tools like the AI Act Risk Classifier and Vendor Due Diligence Questionnaire Generator help you assess and document compliance with emerging rules.

For managing AML and fraud risks associated with onchain markets and AI-driven finance, RisksRadarAI offers cross-domain risk intelligence that fuses signals across HR, Finance, Security, and Operations. Its 12 specialized AI agents operate 24/7 to detect compound risk patterns, automate SAR/STR generation in FinCEN format, and reduce false positives by 80%+. With predictive risk trajectories and immutable audit logs, RisksRadarAI helps compliance teams stay ahead of regulatory expectations.

This content is for informational purposes only and does not constitute legal advice.