The Securities and Exchange Commission (SEC) has published a 401-page proposal titled “Regulation Crypto Assets,” establishing the first dedicated securities framework designed specifically for crypto asset investment contracts.
Core Offerings and Exemptions
The regulation centers on “covered investment contracts” to address how crypto projects raise funds from investors. The proposal introduces two primary exemptions. The startup exemption permits early-stage crypto projects to raise up to $5 million over a four-year period. A broader fundraising exemption allows annual raises of up to $75 million, subject to required financial statements and reporting standards.
Additionally, the proposal features a safe harbor provision designed to address situations where projects remain subject to securities law indefinitely. Under the safe harbor, projects that meet specific decentralization thresholds could potentially be exempt from ongoing securities classification.
Background and Next Steps
The proposal follows an SEC interpretation issued in March 2026 regarding how existing securities laws apply to certain crypto assets, alongside legislative shifts such as the 2025 GENIUS Act.
Public comments on the Regulation Crypto Assets proposal are open through approximately October 20, 2026. Key areas of focus during the comment period include the specifics of disclosure requirements and the exact metrics and benchmarks established for decentralization thresholds.
