US Regulators Unveil Sweeping Crypto Reforms Amid Industry Pressure

The Securities and Exchange Commission (SEC) has proposed a new framework for regulating crypto assets, known as Regulation Crypto Assets. This proposal marks a significant shift in the SEC's approach to regulating cryptocurrencies, which have been largely governed by informal guidance and enforcement over the past decade.

Under Regulation Crypto Assets, certain investment contracts involving crypto assets would be exempt from registration under the Securities Act of 1933. The Commission has stated that this framework is designed to provide a 'fit-for-purpose' regime for offering these types of investments without requiring costly and time-consuming registration processes.

The Commodity Futures Trading Commission (CFTC) has also issued proposed amendments to its rules regarding commodity pool operators and commodity trading advisors. These changes would add an exemption from registration for certain SEC-registered investment advisers operating commodity pools limited to sophisticated investors, as well as increase the capital contribution threshold in the existing small commodity pool operator's registration exemption.

Meanwhile, the Treasury Department has proposed a new rule on payment stablecoin issuance, offer, and sale under the GENIUS Act. This rule would define what it means to issue or offer payment stablecoins in the United States and provide regulatory clarity for the industry on these terms.