SEC Delays Regulation NMS Compliance for Equity Markets
The U.S. Securities and Exchange Commission (SEC) has issued an exemptive order delaying major compliance deadlines for Regulation NMS (National Market System) rules. This move, originally intended for traditional equity markets, now presents significant tactical ammunition for crypto-exchange litigants. By creating a space for enforcement when rules are in flux and agencies lack clear guidance, the order may change how the crypto industry argues its cases.
Impact of the SEC Order on Equity Markets
The SEC exemptive order delays compliance deadlines for multiple amendments to Regulation NMS. Specifically, the compliance date for Rules 600(b)(89)(i)(F) and 612, governing amended minimum pricing increments, is now slated for the first business day of November 2026. Rule 610(c), concerning access-fee caps, is also moved to November 2026. Rule 610(d), the requirement that exchange fees be determinable at the time of execution, is pushed to the first business day of February 2026.
The order also grants relief from the requirement to file proposed rule changes to reflect the revised ‘round lot’ definition in Rule 600(b)(93) for 30 days after the end of the appropriations lapse. According to SEC Chairman Paul S. Atkins, the relief was “necessary to facilitate orderly market functions,” given the funding lapse and ongoing judicial review. Therefore, the SEC is acknowledging that market participants face compliance pressure when the rule-making and oversight framework is unsettled.
Significance for Crypto Exchanges
Although the consequences of the SEC exemptive order formally apply to traditional equity markets, the underlying logic could be applied to the crypto industry. Crypto platforms like Coinbase Global, Inc., Kraken Financial, and Binance Holdings Ltd. have long argued they were subject to enforcement even though the SEC has not provided clear, final rules on how securities laws apply to digital-asset platforms.
The SEC exemptive order confirms a principle: that when rules are contested and implementation is uncertain, compliance deadlines can be delayed and enforcement paused. That principle can now be cited in crypto litigation. In other words, the SEC is giving exchanges a precedent for the argument that “you can’t enforce obligations while standards are unwritten or unclear.” In short, the same logic that applies to equity exchanges can now strengthen crypto platforms’ claims that enforcement should wait for clarity.
Strengthening Fair-Notice and Due-Process Defenses
Crypto litigation has seen the rise of the “fair-notice” defense, which posits that an exchange cannot be punished for conduct if it did not have reasonable notice of how to comply. In January 2025, Judge William H. Orrick III ruled that Kraken “plausibly alleged” lack of notice about how the Howey test applied to secondary token trades. In June 2023, Bittrex, Inc. argued it “didn’t have fair notice” that listing tokens for spot trading triggered registration requirements.
Judge Bibas, in the Coinbase concurrence, wrote:
“The SEC repeatedly sues crypto companies for not complying with the law, yet it will not tell them how to comply”
The Regulation NMS order demonstrates that even for clearly regulated equity markets, when rule-making is unsettled and appropriations lapse, the SEC grants relief. Crypto platforms can now point to this as an argument that enforcement should be delayed until the rules are final.
Parallels Between Equity and Crypto Markets
The SEC exemptive order cites three structural factors: a judicial stay denial, a partial agency funding lapse, and the inability of participants to implement changes by the original deadline. Crypto exchanges make similar claims. For three years, enforcement has occurred under securities law, yet no final crypto-specific rules on custody, listing, trading, or exchange registration have been established. Platforms argue they cannot comply with standards that do not exist in final form.
The SEC’s decision to grant relief to equity markets because participants cannot reasonably implement the changes under current conditions serves as a strong example. Enforcement without a clear roadmap is under new scrutiny. Thus, the structural parallel is direct, and crypto defendants will likely cite the SEC’s own model.
Conclusion
The SEC exemptive order does not explicitly mention blockchain or tokens, but its procedural logic opens a likely path. If the SEC eventually finalizes crypto-market-structure rules, whether via formal rule-making or settlement frameworks, similar exemptive orders may be issued to give platforms time to build compliant systems. The delay until February 2026 for some rules and November 2026 for others creates a two-year window of uncertainty.
Crypto litigation during this timeframe will likely focus on motions to stay or preliminary injunctions, using the crypto enforcement relief angle. Lawyers for exchanges will likely cite the Commission’s acknowledgment that delayed compliance serves orderly markets when rules are contested and resources are limited.
Glossary
Exemptive order / exemptive relief: An order by a regulator that temporarily relieves a party or category of parties from compliance with a specified rule or requirement.
Regulation NMS (National Market System): A regulatory framework overseen by the SEC governing the U.S. securities trading system, including pricing increments, access fees, and transparency requirements.
Fair-notice defense: A legal argument that a regulated entity cannot be held liable for violating a law if it did not receive clear notice or guidance on how to comply.
Due-process: A constitutional principle ensuring that regulatory actions follow fair procedures, including giving entities clear rules and adequate notice before enforcement.
Howey test: The legal test derived from the U.S. Supreme Court decision in SEC v. W. J. Howey Co. (1946) to determine whether a transaction qualifies as an “investment contract,” and thus a security, under U.S. law.
Access-fee caps: Limits imposed on the fees that market venues (exchanges) can charge other market participants for access to order-routing or execution services.
Frequently Asked Questions About the New SEC Exemptive Order
Does this SEC exemptive order immediately protect crypto exchanges from all enforcement actions?
No. The SEC exemptive order applies to equity-market rules under Regulation NMS; not directly to crypto platforms. However, the logic may be invoked by crypto defendants in court.
Which crypto exchanges could use this precedent?
Platforms that are subject to enforcement actions by the SEC, for operating unregistered exchanges or trading venues, such as Coinbase, Kraken, and Binance, may cite the example when asserting fair-notice or due-process arguments.
When do the new deadlines take effect?
For Rules 600(b)(89)(i)(F) and 612 and Rule 610(c); November, 2026. For Rule 610(d); February, 2026.
Could the SEC issue similar relief specifically for crypto markets?
Yes. If the SEC eventually finalizes crypto-specific market-structure rules, it may issue exemptive relief giving digital-asset platforms time to implement compliant systems, following the procedural logic of this order.
What to do now?
Review enforcement risks; add fair-notice and due-process to your legal strategy; watch the rule-making clock and prepare for stays or injunctions.