SEC Proposes ‘Regulation Crypto Assets’ Framework to Replace ‘Inapt’ Rules, Offering Up to $75 Million Exemptions

Add to Google Preferred Sources
The U.S. Securities and Exchange Commission proposed a new regulatory framework for digital assets on Tuesday, creating two registration exemptions for token offerings — one allowing a one-time $5 million raise over four years, and another permitting up to $75 million annually with ongoing reporting requirements. Commissioner Hester Peirce called the proposal an important step away from “inapt” rules that have burdened the crypto industry, while Chairman Paul Atkins said the prior enforcement-heavy approach had driven investment offshore. The proposal includes a conditional safe harbor allowing crypto assets to exit investment contract status once promised managerial efforts are completed. It arrives days after the Senate failed to advance the CLARITY Act, with Galaxy Digital cutting odds of that bill passing in 2026 to 10%. Public comments remain open for 60 days.

Key Elements

The U.S. Securities and Exchange Commission unveiled a long-awaited regulatory framework for digital assets on Tuesday, a move Commissioner Hester M. Peirce described as an important step away from what she called a set of “inapt” rules that have governed crypto offerings for years.

The proposal, formally titled “Regulation Crypto Assets,” aims to create what the agency called a “clear and fit-for-purpose framework for certain investment contracts involving crypto assets,” allowing token issuers to raise capital under federal securities laws while establishing clearer boundaries for when a crypto asset ceases to be an investment contract.

Peirce, a longtime advocate for clearer crypto regulation, said in a statement released Tuesday that a “whole generation has struggled with the SEC’s insistence” on applying “a set of inapt rules to crypto.” The new guidelines, she added, mark an important step toward “putting clear, sensible, enforceable rules in place for crypto offerings.”

SEC Chairman Paul S. Atkins echoed that sentiment in a separate statement, arguing that the agency’s prior enforcement-heavy approach “has driven investment offshore, limiting the type of protections that we can provide investors here.” Atkins said the framework is intended to give crypto entrepreneurs “clear pathways to raise capital under the federal securities laws.”

The proposal comes at a critical juncture for the digital asset industry, arriving just days after the Senate failed to advance the Digital Asset Market Clarity Act before lawmakers departed for the August recess. That legislation, known as the CLARITY Act, would establish a comprehensive division of regulatory responsibilities between the SEC and the Commodity Futures Trading Commission across digital asset markets.

Under the proposed framework, the SEC would create two exemptions from Securities Act registration requirements. The first would permit a one-time offering of up to $5 million over a four-year period. The second, larger exemption would allow offerings of up to $75 million in any 12-month period, though issuers using this path would be subject to financial statement and ongoing reporting obligations.

A separate conditional safe harbor provision would allow a crypto asset to fall outside the definition of an investment contract once the issuer has completed or ceased the managerial efforts it promised to investors. The rules would also preempt certain state registration requirements for qualifying offerings and secondary-market transactions.

Note: The proposed framework also includes a conditional safe harbor allowing assets to exit investment contract status once promised managerial efforts are completed or ceased.

The SEC’s move follows months of uncertainty over whether Congress would deliver a legislative solution. On July 27, Atkins told CNBC that the agency was “ready, willing, and able to come out with rules” on digital assets if the Senate failed to pass the CLARITY Act. That conditional commitment has now materialized.

Galaxy Digital has sharply reduced its odds on the CLARITY Act passing in 2026 to just 10%, warning that multiple political issues remain unresolved. The firm noted that the Senate will have only about two to three weeks to pass the bill when it reconvenes on September 14, a narrow window for legislation of this complexity.

Senate Majority Leader John Thune has filed cloture on a motion to take up the bill when lawmakers return in mid-September, signaling that the legislative effort is not abandoned. However, the SEC’s regulatory action suggests the agency is not waiting for Congress to act.

The distinction between the two approaches matters for the industry. The CLARITY Act would define the respective roles of the SEC and CFTC across digital asset markets, creating a statutory foundation that would outlast any single Commission. Atkins has acknowledged that legislation remains necessary to make any regulatory framework durable beyond the current Commission’s tenure.

Public comments on Regulation Crypto Assets will remain open for 60 days after publication in the Federal Register, giving market participants, legal experts, and industry groups an opportunity to weigh in on the proposal’s specifics.

For crypto companies seeking near-term access to U.S. capital markets, the SEC’s rulemaking may provide a more immediate path than waiting for congressional action. The proposal’s tiered exemptions — particularly the $75 million annual ceiling — could open meaningful fundraising avenues for startups and established projects alike, while the safe harbor provision addresses a long-standing industry concern about assets remaining perpetually classified as securities.

The proposal represents one of the most concrete regulatory developments for the crypto industry in years, potentially reshaping how token offerings are structured and conducted in the United States. Whether it survives the comment period and potential legal challenges, and how it interacts with any future congressional action, will be closely watched by issuers, exchanges, and investors across the digital asset ecosystem.

Once added, BigGo Finance appears first in Google Search Top Stories, so you get the broadest, most up-to-the-minute, and most comprehensive global financial news first.

Source: finance.biggo.com