Key Takeaways
- • The SEC proposed "Regulation Crypto Assets," a roughly 400-page rulemaking that creates tailored offering exemptions and a safe harbor for non-security crypto assets sold under an investment contract, according to the SEC's published statement and proposal summaries.
- • The proposal includes a "startup exemption" allowing offerings of up to $5 million over a four-year period and a "fundraising exemption" allowing offerings of up to $75 million per year.
- • The fundraising exemption requires disclosure of issuer financial condition, with financial statements that must be audited at certain capital-raising thresholds; both exemptions carry principles-based disclosure requirements tailored to crypto assets.
- • An "investment contract safe harbor" would end SEC treatment of a crypto asset as subject to an investment contract once the issuer certifies it has ceased all essential managerial efforts promised under that contract and meets other conditions.
- • Public comments are due 60 days after publication in the Federal Register, so the proposal is not yet final and issuers, funds and fintech firms are being advised to review pending token offerings against it.
Summary
The Securities and Exchange Commission has proposed "Regulation Crypto Assets," which the agency describes as its first purpose-built offering regime for crypto assets. The SEC announced the proposal on August 18, 2026. According to the SEC's published statement, the rules are designed to restore American leadership in capital formation and to address what the Commission described as a "square peg in a round hole" approach, under which issuers selling non-security crypto assets subject to an investment contract have had to comply with SEC rules drafted largely in the 1930s.
The proposal would create two offering exemptions from registration under the Securities Act of 1933. A "startup exemption" would permit offerings of up to $5 million over a four-year period. A "fundraising exemption" would permit offerings of up to $75 million each year. Both carry principles-based disclosure requirements tailored to crypto assets, and the fundraising exemption also requires disclosures on the issuer's financial condition, including audited financial statements at certain capital-raising thresholds.
The proposal also includes an investment contract safe harbor. Under it, if an issuer certifies to the Commission that it has ceased or terminated all essential managerial efforts promised under the investment contract and satisfies other conditions, the Commission would no longer treat the non-security crypto asset as subject to an investment contract, and therefore no longer within its authority. Commissioner Hester Peirce's earlier safe harbor concept was cited by the Commission as a foundation for the proposal.
The proposal is subject to a public comment period of 60 days following publication in the Federal Register. Coverage of the rulemaking has also linked it to broader market structure legislation. The SEC stated that legislation remains necessary to make the rules durable, and that it supports Congress in delivering the CLARITY Act. Separate reporting noted that the Senate failed to advance the CLARITY Act in a vote, while the SEC issued related exemptions for tokenized securities venues. Because the source text for this story could not be fully retrieved, the details above rely on the SEC statement and headline-level reporting, and the final rules may differ from the proposal.
The proposal would create two offering exemptions from registration under the Securities Act of 1933. A "startup exemption" would permit offerings of up to $5 million over a four-year period. A "fundraising exemption" would permit offerings of up to $75 million each year. Both carry principles-based disclosure requirements tailored to crypto assets, and the fundraising exemption also requires disclosures on the issuer's financial condition, including audited financial statements at certain capital-raising thresholds.
The proposal also includes an investment contract safe harbor. Under it, if an issuer certifies to the Commission that it has ceased or terminated all essential managerial efforts promised under the investment contract and satisfies other conditions, the Commission would no longer treat the non-security crypto asset as subject to an investment contract, and therefore no longer within its authority. Commissioner Hester Peirce's earlier safe harbor concept was cited by the Commission as a foundation for the proposal.
The proposal is subject to a public comment period of 60 days following publication in the Federal Register. Coverage of the rulemaking has also linked it to broader market structure legislation. The SEC stated that legislation remains necessary to make the rules durable, and that it supports Congress in delivering the CLARITY Act. Separate reporting noted that the Senate failed to advance the CLARITY Act in a vote, while the SEC issued related exemptions for tokenized securities venues. Because the source text for this story could not be fully retrieved, the details above rely on the SEC statement and headline-level reporting, and the final rules may differ from the proposal.
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