Key Highlights
- The SEC has proposed new exemptions allowing crypto projects to raise up to $5 million over four years or $75 million annually without full securities registration.
- This proposal includes a safe harbor provision, which could enable a crypto asset to detach from the investment contract under which it was initially sold.
- The announcement follows the cancellation of a meeting regarding the framework, which reportedly faced pressure from Wall Street and the White House.
On Tuesday, the Securities and Exchange Commission revealed its latest rules that would allow cryptocurrency projects to secure funding without the necessity for comprehensive securities registration. This marks a significant shift in policy after the SEC postponed a meeting last week where these measures were anticipated to be unveiled.
Under the proposed “Regulation Crypto Assets,” startups could utilize an exemption that would enable them to raise up to $5 million over a four-year period. Additionally, another exemption would permit token issuers to gather up to $75 million each year, provided they submit financial statements and ongoing reports.
Both exemptions would necessitate disclosures, while existing federal antifraud and antimanipulation regulations would remain in effect.
This initiative arrives at a crucial moment for the cryptocurrency sector, which has recently seen setbacks in discussions surrounding the Clarity Act, dampening expectations that this significant market-structure legislation would be enacted this year. If enacted, the Clarity Act would formally legitimize most cryptocurrency activities within the United States. SEC Chair Paul Atkins had indicated in late July that the Commission was ready to intervene with its own regulations should the bill not proceed.
SEC Commissioner Hester Peirce acknowledged that these proposed exemptions would not encompass all crypto projects, urging the industry to provide input on how the regulations could evolve.
“The Commission aims to foster innovation in various areas, and our regulations must adapt to the evolving market landscape while safeguarding investors and market integrity,” she stated. “This proposal marks an initial step in a lengthy journey toward establishing a clear, sensible, and enforceable regulatory framework for cryptocurrencies.”
The proposal also introduces a conditional safe harbor that would allow issuers to “delink” a cryptocurrency from the investment contract it was sold under, enabling a token initially associated with a securities transaction to separate from that contract if the issuer complies with the SEC’s stipulations.
This announcement follows the SEC's abrupt cancellation of a meeting concerning Regulation Crypto Assets last week due to an “unforeseen scheduling issue.”
On Monday, Crypto In America reported that SIFMA, a trade association for Wall Street representing broker-dealers, investment banks, and asset managers, had contemplated a legal challenge against the SEC’s authority. Concurrently, the White House had requested that the agency delay the meeting amid ongoing Clarity Act negotiations.
This development also coincides with other federal agencies moving forward with their own cryptocurrency regulations. On Monday, the U.S. Treasury Department proposed regulations under the GENIUS Act, which would generally require stablecoin issuers to secure federal or state licenses starting January 2027. Furthermore, crypto platforms would be restricted from selling stablecoins from non-approved issuers beginning July 2028.