In a notable development, the U.S. Securities and Exchange Commission advanced its first major crypto-specific rule proposal in some time, unveiling the “Regulation Crypto Assets” framework on August 18. The proposal creates a tailored offering regime for certain investment contracts involving crypto assets and arrives amid ongoing debates over market structure legislation, following the earlier cancellation of a related open meeting.

The framework includes two new exemptions from Securities Act registration requirements. A “startup exemption” would permit offerings of up to $5 million during a four-year period. A broader “fundraising exemption” would allow offerings of up to $75 million during each 12-month period, subject to the provision of financial statements and ongoing reporting obligations. Both pathways require principles-based disclosures tailored to crypto assets, while antifraud and antimanipulation provisions of the federal securities laws continue to apply.

In addition, the proposal features a conditional safe harbor. Once an issuer certifies that it has completed or permanently ceased all essential managerial efforts originally promised under the investment contract and satisfies other conditions, the associated non-security crypto asset would no longer be deemed subject to an investment contract—and therefore would fall outside the SEC’s jurisdiction under the relevant definitions of “security.”

SEC Chairman Paul Atkins framed the proposal as a fit-for-purpose response that gives entrepreneurs clearer pathways to raise capital while preserving core investor protections. Commissioners Hester Peirce and Mark Uyeda also issued supportive statements, emphasizing that the rules replace regulatory guesswork with measurable thresholds and defined obligations. The Commission opened a 60-day public comment period after publication in the Federal Register.

The move builds directly on the SEC’s March 2026 interpretive guidance clarifying the application of federal securities laws to crypto assets. Industry groups welcomed the development as a constructive step toward reducing the incentive for projects to operate offshore. On X, reaction was broadly optimistic, with market participants describing the framework as a shift away from regulation-by-enforcement toward clearer rules that could support domestic innovation and capital formation even as broader legislative efforts, including the Clarity Act, face continued headwinds.

While the proposal remains subject to public comment and potential revision before any final rule, it marks a meaningful evolution in the SEC’s approach to crypto fundraising and investment-contract treatment.