The Securities and Exchange Commission has proposed its own framework for crypto asset offerings, pressing ahead while landmark legislation stalls.
The regulator unveiled “Regulation Crypto Assets” on Tuesday, a tailored offering regime it says will let token issuers raise money in the U.S. without falling foul of securities laws.
Tuesday’s proposal carves out two exemptions from registration under the Securities Act of 1933. The first is a one-time exemption allowing issuers to raise up to $5 million in crypto over four years. The second permits up to $75 million in any 12-month period, but comes with financial statements and ongoing reporting obligations. Both require issuers to make narrative disclosures — written explainers for investors outlying a business and its risks — available.
The rules also dangle a conditional safe harbor. Once an issuer has completed — or permanently abandoned — the managerial work it promised, its token would no longer be deemed subject to an investment contract, and so would sit outside the definition of a “security.”
SEC Chairman Paul Atkins said the proposal was another step to “onshore innovation in crypto asset markets,” and would give entrepreneurs clear pathways to raise capital “as Congress works to establish a lasting regulatory framework.”
That framework is going nowhere fast. Pro-crypto lawmakers had hoped to pass the Clarity Act before Congress broke for August recess, but the vote slipped to September after Democrats balked at the latest draft. Some Republican senators — like Senator Cynthia Lummis — accused some of deliberately holding it back.
Regulators aren’t waiting. CFTC Chairman Michael Selig has said he will proceed with rulemaking whether or not the Clarity Act is enacted, aiming to finalise rules before the administration’s term is out.
The proposal builds on the SEC’s March interpretation of how securities laws apply to crypto. Comments are open for 60 days after publication in the Federal Register.
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