The U.S. Securities and Exchange Commission has officially put forward for discussion the “Regulation Crypto Assets” rules. This is the regulator’s first significant step toward establishing a clear and separate framework for investment contracts related to crypto assets.
Here’s what’s being proposed:
• A streamlined pathway for small-scale projects: Startups will be able to raise up to $5 million over four years without full SEC registration. No heavy financial reporting requirements at this stage.
• A higher “fundraising” limit: A separate exemption allows raising up to $75 million every 12 months. Financial reports, disclosure of project details and financial status, plus regular post-placement reporting are mandatory.
• Safe harbor: a mechanism for exiting securities status. If the team has fully fulfilled or permanently ceased all material management efforts promised to investors (and complied with other conditions), the token ceases to be considered an investment contract. Consequently, it falls outside the definition of “security” under federal law.
Important clarification: The token itself is not necessarily a security. What could be a security is precisely the investment contract under which this token was sold.
This is currently just a proposal. After publication, the market will have 60 days to provide feedback. Further amendments and a final vote will follow.