SEC Proposal Could Open New Path for Digital Asset Fundraising
Key Takeaways
- •The SEC proposed Regulation Crypto Assets to create a framework for certain investment contracts involving crypto assets, following its March 2026 interpretation of how federal securities law applies to some digital assets.
- •The proposal offers two Securities Act registration exemptions, permitting issuers to raise up to $5 million over four years or up to $75 million within 12 months, with the larger tier requiring financial statements and continuous reporting.
- •A safe harbor provision would allow a crypto asset to be treated as no longer tied to an investment contract once the issuer completes or abandons its essential management functions, an approach echoing Commissioner Hester Peirce's token safe harbor proposals from 2020.
- •The rule would preempt some state securities registration requirements for issuances under the new framework, which the SEC says could create a more uniform regulatory environment and reduce incentives for crypto firms to raise money overseas.
- •The proposal is not final; a 60-day public comment period will open after publication in the Federal Register, and the SEC may revise the rule after reviewing submissions.
The SEC crypto rule may give crypto firms an easier way to raise money in the United States by allowing them to bypass some of the registration requirements under existing securities regulations. The Securities and Exchange Commission proposed the framework on Tuesday, and the rule is intended for certain investment contracts involving crypto assets.
🚨 TODAY: The SEC proposed new rules, “Regulation Crypto Assets,” that would create a clear and fit-for-purpose framework for certain investment contracts involving crypto assets. pic.twitter.com/SAA2sErMXF — U.S. Securities and Exchange Commission (@SECGov) August 18, 2026
🚨 TODAY: The SEC proposed new rules, “Regulation Crypto Assets,” that would create a clear and fit-for-purpose framework for certain investment contracts involving crypto assets. pic.twitter.com/SAA2sErMXF
The proposal, called Regulation Crypto Assets, followed the SEC’s March 2026 interpretation of how federal securities law applies to some crypto assets.
SEC Crypto Rule Introduces Two Fundraising Exemptions
Under the proposal, companies would be able to use two exemptions from Securities Act registration.
The first exemption would allow issuers to raise up to $5 million over four years. The second would allow issuers to raise up to $75 million within 12 months. The $75 million ceiling matches the cap under the existing Regulation A Tier 2 exemption, which companies already use to conduct smaller public offerings without a full Securities Act registration.
Companies using either exemption would be required to provide principles-based disclosures for investors. Issuers relying on the larger $75 million exemption would also need to provide financial statements and continuous reporting disclosures.
The SEC said the changes could give small cryptocurrency projects more flexibility when raising capital.
SEC Crypto Rule Could Change How Crypto Assets Are Treated
The proposal also includes a safe harbor for some crypto assets that may initially be linked to an investment contract.
Under the proposed regulation, an asset could be treated as no longer associated with an investment contract in certain circumstances, including when the issuer completes or abandons the essential management functions tied to the asset.
That provision could help crypto projects that evolve over time, since it creates a path for an asset to move beyond the investment contract framework after the issuing company has fulfilled its managerial responsibilities. The concept has precedent at the agency: Commissioner Hester Peirce put forward successive token safe harbor proposals beginning in 2020 that similarly sought to let assets initially offered as part of investment contracts shed that status over time.
SEC Chair Paul Atkins said the initiative is designed to give crypto firms ways to raise funds through the federal securities laws. He also linked the framework to other efforts aimed at supporting the digital assets business in the United States.
Proposal Could Reduce Offshore Incentives
Another major part of the SEC crypto rule concerns state securities registration requirements.
The proposal would preempt some state securities registration rules for issuances made under Regulation Crypto Assets. Certain secondary market transactions tied to those issuances would be treated similarly.
According to the SEC, this would help create a more uniform regulatory environment in the United States. The agency also said federal rules could reduce the incentive for cryptocurrency firms to raise money overseas because of uncertainty around U.S. securities requirements.
The proposal may also expand access to some digital asset investment opportunities for U.S. investors by setting disclosure rules for participating issuers.
SEC Crypto Rule Now Moves to Public Comment
The rule is not final. The SEC will open a 60-day public comment period after the proposal is published in the Federal Register.
During that period, cryptocurrency companies, investors, lawyers, and other market participants can comment on the proposed exemptive relief, disclosure requirements, safe harbor provisions, and state-law rules. Submitted comments are placed in the public rulemaking file on the SEC’s website, where the full record of the debate over the proposal will be visible.
The SEC may revise the proposal after reviewing those comments. Even so, the agency’s move marks another step toward building a formal fundraising framework for crypto assets in the United States.
