SEC Proposes "Regulation Crypto Assets" Framework

The SEC just formally proposed Regulation Crypto Assets, a new offering framework that would let crypto projects raise up to $5M through a one-time startup exemption or up to $75M annually through a tiered fundraising exemption.

What's the Scoop?

• The exemptions: The startup lane allows $5M over four years with no accredited-investor requirement or per-investor cap. The fundraising lane allows $75M every 12 months, split into a $20M Tier 1 and $75M Tier 2, with Tier 2 issuers needing audited financials and ongoing reporting, and non-accredited buyers capped at 10% of income or net worth. Tokens sold under either lane wouldn't carry a rule-based resale lockup.

• The safe harbor: Once a team finishes, or permanently drops, the managerial work it promised, its token can shed "investment contract" status for good—a formalized version of the concept the SEC's March interpretive guidance first floated. The rule would also preempt state-level securities registration for these offerings and certain secondary trades.

• What's missing: The SEC's separate "innovation exemption," expected to let firms tokenize actual securities like stocks and trade them onchain, wasn't part of Tuesday's release. The agency explicitly said it isn't touching registered-offering rules for "digital securities" this round, so tokenized equities on public blockchains remain unaddressed.

• Why the delay: CoinDesk reported the tokenization piece had been expected to land alongside the fundraising rule before the SEC abruptly pulled an Aug. 14 meeting. The holdup has been tied to White House concerns about muddying live CLARITY Act talks, internal questions over the SEC's own statutory authority, and Wall Street's SIFMA objecting to using exemptive relief for market-structure changes.

• The Congress comparison: The Senate's CLARITY draft, still stuck in negotiation, uses different numbers entirely: up to $50M a year and $200M cumulative without full registration. The SEC and Congress are effectively racing toward the same goal on separate tracks.

• Zooming out: This new proposal is really an ICO fundraising upgrade, not the "stocks onchain" moment markets have been waiting for. That piece is still stuck behind political and TradFi resistance. The 60-day comment window opens once the proposal hits the Federal Register, with a final rule realistically months out.