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Promoting Fair and Competitive Markets

April 14, 2023

In January 2022, the SEC took steps to address a competitive imbalance between unregistered trading platforms that perform similar functions as those of registered exchanges and alternative trading systems, or ATSs. The proposed amendments were designed to close a regulatory gap and strengthen oversight, protect investors and promote fair and orderly markets.

As part of this effort, the Commission today is reopening those same proposals to address trading systems that trade crypto asset securities. Doing so will offer the public the opportunity to provide additional comments on the scope and application of the January 2022 proposals.

To inform the Commission’s goal of achieving an approach that provides for fair competition between trading systems that perform similar functions, we must consider how the proposed amendments would apply to all unregistered trading systems, regardless of the specific technology market participants use to issue or transfer securities.

Investors that use similar systems to trade securities should benefit from the same investor protections offered by our exchange regulatory framework. This framework includes robust SEC oversight and important investor protection provisions under Regulation ATS, such as fair access, written policies and procedures, and cybersecurity requirements. This framework also helps address competitive imbalances between similar marketplaces.

I look forward to receiving public feedback on these proposals that will help the Commission close the regulatory gap between registered and unregistered trading platforms. I am pleased to support this proposal. As always, my gratitude to all of the Commission staff for their hard work in crafting this important rule, and for their commitment to public service and to the fulfillment of the SEC’s mission on behalf of the investing public.

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