Remy Blaire: We are just over a month away from the midterms, and the crypto industry didn't get much help from Congress this year.
But with the balance of power in Washington potentially shifting in the next Congress, DeFi is relying on U.S. regulators to clear the way for the industry.
Now, since the failed CLARITY Act vote two weeks ago, we have seen the SEC focus on tokenized stocks, while the CFTC has sent proposed rules to the White House.
And while the crypto industry may be disappointed about the CLARITY Act, clear regulatory progress has been made since Paul Atkins took over for Gary Gensler as SEC Chair.
Well, joining us live here at the New York Stock Exchange is Solana Policy Institute President Kristin Smith.
Kristin, wonderful to have you back. Thank you so much for joining me.
Kristin Smith: It's great to be here, Remy.
Remy Blaire: Well, you are joining us as we head into the final quarter of 2026. And what a year it has been.
So the last time, Kristin, that you and I spoke, this was before the vote on the CLARITY Act. And, of course, that Senate cloture vote did fail.
But there have been so many headlines to digest since then. So what do you make of where we are right now?
Kristin Smith: Yeah, no, I think it's an excellent question.
I think it's important to put all of this in context.
When I first started in the crypto policy regulatory space back in 2018, the industry really wanted the agencies to provide guidance and rulemaking.
Unfortunately, what the agencies got were regulation by enforcement, criminal investigations and debanking, which didn't go so well.
But the industry responded with a political effort, a big political push to keep this technology here in the U.S., which in turn got Congress involved, which has now led us to the regulators, which is exactly where we wanted to be back in 2018, taking charge.
So I think even though the CLARITY Act vote feels like a failure, we're at the exact place we need to be.
The agencies are moving forward in a targeted and thoughtful fashion, and I think we're going to get the clarity, with a small C, that the industry needs, and we're going to be able to move forward.
Remy Blaire: Yeah, I like that clarity with a small C.
And given the fact that we have been hearing from the CFTC as well as the SEC, what do you think the regulatory path looks like here in the U.S. as we head into the final months of 2026?
Kristin Smith: Well, I think we're going to see a lot of announcements. We already have seen a lot of announcements.
We have the SEC doing crypto. They did a tokenization exemption.
There's going to be a big push in the short term for the agencies to put out and start as much of the process as they can.
And the reason is, for the agency to do a full rulemaking process, it takes anywhere between 18 and 24 months.
So it's really important that the CFTC and the SEC make it all the way through the process and get these rules finalized before we head into 2028, because nobody knows who's going to be in the White House in 2029 or how the Congress is going to be made up, and we don't want them to undo that regulation.
So I think if we can get it done and people start to rely on it and they see, oh my gosh, it's really great to have tokenized equities because I could trade them all hours of the day. It's faster, cheaper, better.
Nobody's going to want to undo those rules.
And so I think, you know, the key is to get them in place, get people using them, and then I think they're going to be fairly permanent.
Not quite to the level of legislation, but I think they'll be here to stay.
Remy Blaire: And Kristin, while you are here, we are counting down to the midterms, which are about a month away now since we are about to head into the month of October.
But would you say that regulators are now delivering the market structure? And what about innovation?
Kristin Smith: Yeah. No, I mean, listen, I think the regulators are doing their piece.
As we look to the midterms, we could see some changes in Congress.
And so we may, in a Democratic-controlled House or Senate, see some approaches to legislation that are less workable for the industry.
I also think we might see some investigations around, you know, the Trump administration's involvement in crypto.
So I think we may have some distractions on the horizon. I think we're going to need to play defense as an industry.
But as long as the regulators keep going and put those rules and get those final, I think we're going to see innovation flourish here in the United States, which is exactly, you know, sort of the goal that the industry has had.
Remy Blaire: And you and I have had a lot of conversations about innovation and rules when it comes to developers.
But where do we stand right now here in the U.S., say, compared to other regions of the globe right now?
Kristin Smith: Yeah. No, I mean, listen, I think the U.S., we've made a lot of progress, right?
We have a very supportive government of the industry.
We have the GENIUS Act that provides rules of the road around stablecoins. We've undone a lot of the harmful policies of the past.
And so I do think if you look at kind of some of the things the SEC is doing, like this innovation exemption for tokenized securities, you know, that's huge.
That allows for innovation to happen here.
And as that process is underway, we will have more permanent rules being written, and they'll be able to be informed by some of the test cases that we're going to see happening in the marketplace.
So I think, you know, if you look at a blockchain like Solana, it's the fastest, most-used blockchain in the world.
It is a really great place to issue and trade securities, and it can integrate with the existing financial system and make it cheaper, faster.
So that means there's more customers and more companies that are able to access public markets.
Remy Blaire: And finally, Kristin, before I let you go, of course, you are counting down to Breakpoint, which is coming down the pike.
But there have been a lot of industry events, and you have been speaking with stakeholders here in the U.S. as well as abroad.
So what would you like viewers to know about where we are in digital assets?
Kristin Smith: Yeah. I mean, listen, I think we're at an inflection point.
Like, the technology has proved itself to be useful. The regulation has almost caught up to where we need to be, and I think we're starting to see a lot of changes.
I've spoken a lot with traditional financial institutions, with asset allocators that, you know, have in the past been afraid to get close to the blockchain and crypto sector.
But now they're saying, hey, this is a solution that might help my business, my company. This is an asset class that I'm interested in investing in.
And they feel confident that the rules are there and the government's not going to come and try to squash this technology in its infancy.
So I think we're well beyond that phase.
And this is something that's here to stay. And it's a very, very exciting time, I think, for Solana and for digital assets generally.
Remy Blaire: Well, Kristin, I appreciate your time.
Thank you so much for joining us today here as we head into the final quarter of 2026.
Kristin Smith: Thanks for having me. I appreciate it.
