SEC Proposes Reg Crypto, A New Framework for Token Issuance

The U.S. Securities and Exchange Commission (SEC) has proposed a new regulation called Reg Crypto, aimed at providing clarity for token issuers in the country.

This regulation establishes a lifecycle framework for tokens, from issuance to exit, through financing exemptions, exclusive disclosure requirements, and safe harbor mechanisms.

The proposal provides a legal pathway for certain tokens to be sold to the U.S. public, including allowing non-accredited investors to participate without the need for a registered offering.

The regulation is divided into four phases: Raise, Disclose, Build, and Exit. During the Raise phase, issuers can raise up to $5 million over a maximum of four years with public filings required at the start and end of this period.