SEC Proposes Regulation Crypto Assets Framework for US Fundraising

The U.S. Securities and Exchange Commission (SEC) has proposed Regulation Crypto Assets, a new framework covering certain investment contracts involving crypto assets and fundraising activities in the United States.

The proposal would create specific pathways for eligible offerings, introduce a conditional safe harbor for certain crypto assets after an issuer completes or permanently stops its essential managerial efforts, and preempt certain state securities registration requirements.

Under the proposal, certain offerings could raise up to $5 million over four years or $75 million annually without SEC registration. The framework would also create a conditional safe harbor for crypto assets once an issuer has completed or permanently ceased the essential managerial efforts it represented or promised to undertake under an investment contract.

SEC Chairman Paul S. Atkins said the proposal provides issuers of investment contracts involving crypto assets with a pathway to comply with federal securities law while Congress continues its work on broader crypto market-structure legislation.