SEC Proposes Rule for Crypto Projects to Exit Securities Regulations
The US Securities and Exchange Commission (SEC) has proposed a new rule that would allow crypto projects to exit securities regulations once their tokens are 'functionally available,' without requiring full decentralization.
This move aims to provide project teams with more room to continue development and offers a clearer compliance pathway for token issuance and exit, directly impacting both industry participants and investors.
The proposal was made by SEC Commissioner Hester Peirce, who stated that the goal is 'to create rules that even good people can follow.'
The new rule would exempt tokens from securities laws when the issuer has either 'completed or otherwise permanently ceased' all key management activities related to the underlying protocol. This could take up to four years, during which time developers can continue their projects.