Mark Uyeda, acting chair of the U.S. Securities and Exchange Commission (SEC), asked staff to consider dropping a key part of Regulation ATS, a proposed rule that could have broadened the definition of an exchange to include crypto platforms.

Speaking at the 2025 Annual Washington Conference of the Institute of International Bankers, Uyeda criticized the SEC’s previous approach, saying the agency wrongly tied Treasury market regulation to a crackdown on crypto. He said the rule’s expansion under former Chair Gary Gensler was an overreach that would have forced decentralized finance (DeFi) projects to register with the SEC and comply with strict disclosure requirements.

“The vastly expanded definition of an ‘exchange’ would have picked up various protocols used with respect to crypto assets,” Uyeda said. “In my view, it was a mistake for the Commission to link together regulation of the Treasury markets with a heavy-handed attempt to tamp down the crypto market.”

Regulation ATS, originally developed years ago, was reworked in April 2024 during Gensler’s tenure. It sought to include “communication protocols” in the definition of an exchange, a term Uyeda said was never properly defined. The proposal drew strong opposition from the crypto industry, with critics arguing it could cripple DeFi by imposing excessive regulatory burdens.

Citing widespread negative feedback, Uyeda said he directed SEC staff to explore options for scrapping the crypto-related portion of the rule.

His remarks reflect a continued policy shift under the new Trump administration, which already reversed several of Gensler’s crypto policies. Since Gensler’s exit, the SEC rescinded controversial crypto accounting guidance, dropped enforcement actions against major industry players, formed a crypto task force, and issued a statement on memecoins.

Under acting Chair Mark Uyeda, the SEC paused multiple crypto lawsuits and created a Crypto Task Force led by Hester Peirce, one of the agency’s most pro-crypto commissioners.