SEC proposes Regulation Crypto Assets framework for crypto offerings

The Securities and Exchange Commission announced a proposal titled "Regulation Crypto Assets," intended to create a clear, fit-for-purpose framework for certain investment contracts involving crypto assets. The proposal follows the Commission's March 2026 interpretation that clarified how federal securities laws apply to specific crypto assets and transactions.

The proposed rules contain two exemptions from the registration requirements of the Securities Act of 1933. The first exemption permits a one-time offering of up to $5 million during a four-year period. The second exemption allows offerings of up to $75 million during each 12-month period, subject to principles-based narrative disclosures, financial statements, and ongoing reporting requirements.

A conditional safe harbor would deem a crypto asset not to be an "investment contract" for purposes of the Securities Act of 1933 and the Securities Exchange Act of 1934 if the safe harbor's conditions are met. The proposal also seeks to preempt state securities law registration and qualification requirements for offers, sales, and certain secondary market transactions that rely on the new exemptions.

The SEC states the framework is designed to bring greater clarity to when crypto assets fall within federal securities laws, reduce incentives for offshore issuance, and expand investment opportunities for U.S. investors while preserving core investor protections. The public comment period remains open for 60 days following the release of the proposing release in the Federal Register.