SEC Proposes Major Crypto Rule with Exemptions and Safe Harbor
The US Securities and Exchange Commission (SEC) has proposed its first major rule for regulating cryptocurrencies. Titled 'Regulation Crypto Assets', it aims to create clearer pathways for digital asset offerings.
The proposal includes two exemptions from securities registration requirements specifically tailored for crypto companies. The startup exemption would allow issuers to raise up to $5 million over a four-year period, while the fundraising exemption would permit raises of up to $75 million within any 12-month stretch.
Under both exemptions, companies must provide investors with narrative, principles-based disclosures rather than the dense legal filings typically required of public offerings. The second exemption also requires issuers to publish financial statements and meet ongoing reporting duties.
The framework also introduces a conditional safe harbor that could eventually place certain tokens outside the legal definition of a security once an issuer completes or permanently ceases the managerial efforts it promised investors.
SEC Chair Paul Atkins framed the package as a 'minimum effective dose' of oversight, protecting investors while leaving builders maximum room to innovate. The proposal follows the SEC's March 2026 interpretation clarifying how federal securities laws apply to certain crypto assets and transactions.