SEC Proposes New Crypto Asset Offering Exemptions

The Securities and Exchange Commission on August 18, 2026 proposed Regulation Crypto Assets, a new offering regime that would let crypto projects sell investment contracts to U.S. investors without registering under the Securities Act of 1933, through two exemptions capped at $5 million over four years and $75 million per 12-month period. The proposal, issued as Release Nos. 33-11434 and 34-106150, is the agency’s first attempt at a durable, commission-adopted rule for crypto capital raising after years of staff statements and enforcement actions.

The release lands five months after the Commission’s March 17, 2026 interpretation that sorted crypto assets into five categories and held that only one of them, digital securities, is itself a security. Regulation Crypto Assets addresses what that interpretation left open: how a project whose token is not a security can still legally sell the investment contract wrapped around that token to raise money.

What the Two Exemptions Would Permit

The startup exemption covers offerings of up to $5 million during a four-year period. It is designed for early-stage projects and would also cover airdrops and network-reward distributions that meet its conditions, with principles-based narrative disclosures made available to investors, according to the proposing release.

The fundraising exemption is the larger rail: up to $75 million in any 12-month period, structured in two tiers and modeled on Regulation A, the exemption under which most compliant tokenized offerings in the U.S. have been sold to date. Issuers using it would file a disclosure document with the Commission covering the investment contract, the issuer’s financial condition, and financial statements, and would take on ongoing reporting obligations. Both exemptions require the principles-based disclosures, and issuers relying on either remain subject to the antifraud and antimanipulation provisions of the federal securities laws.

The third prong is a conditional safe harbor from the term “investment contract” itself. If a project satisfies its conditions, the crypto asset would be deemed no longer subject to an investment contract under either the Securities Act or the Securities Exchange Act of 1934, which is the exit from SEC jurisdiction that the March interpretation described but did not operationalize. A fourth element would preempt state securities registration and qualification requirements for offerings under the regime and for certain secondary transactions in those contracts, by defining purchasers as qualified purchasers under the Securities Act’s preemption provision.

The proposing release also creates a family of new forms, including a Form 1-CRYPTO offering statement and annual, semiannual, and current report forms for issuers under the fundraising exemption, all filed electronically on EDGAR. Offering limits under both exemptions would be adjusted for inflation at least once every five years.

The Paper Behind the Proposal

The Commission had scheduled the proposal for an open meeting on August 14, 2026, according to the Sunshine Act agenda posted August 10, 2026, which listed the Division of Corporation Finance as the sponsoring office. The rulemaking docket, File No. S7-2026-27, appears on the agency’s rulemaking activity page with an issue date of August 18, 2026.

The blueprint was public well before that. In remarks at the DC Blockchain Summit on March 17, 2026, Chairman Paul Atkins sketched the same three-part structure and traced it to the token safe harbor framework Commissioner Hester Peirce first published in February 2020. The figures he floated then, $5 million for the startup exemption and $75 million for the fundraising exemption, match the numbers in the formal proposal.

The same speech also delivered the line that now frames the entire project, as Atkins described the Commission’s narrowed jurisdiction over crypto assets.

“We are not the Securities and Everything Commission, anymore,” Atkins said in the March remarks.

The proposing release describes the fundraising exemption’s mechanics as modeled “in large part” on Regulation A. That matters to issuers for a practical reason: Regulation A Tier 2, which caps raises at $75 million in 12 months, has been the workhorse exemption for qualified token offerings in the U.S., but it is available only for equity, debt, and convertible securities. An investment contract over a non-security token fits none of those categories, which is precisely the gap the new regime is built to close. Securities.io has covered how tokenized securities function as wrappers on traditional instruments, and the proposal keeps that distinction intact: tokenized stocks and bonds remain securities under the March interpretation and are excluded from the new exemptions.

Limits the Release States Itself

The proposal’s own text draws its boundaries. The exemptions apply only to covered investment contracts, defined as investment contracts where the subject crypto asset is not itself a security and no other asset is bundled in, so a token sale packaged with company equity would need a different path. The safe harbor is conditional rather than automatic, and both exemptions are non-exclusive, meaning issuers keep access to Regulation D, Regulation A, and other existing exemptions. Nothing in the release changes the treatment of digital securities, which the Commission has said remain fully subject to the securities laws.

Comments on File No. S7-2026-27 are due 60 days after the release is published in the Federal Register, which had not yet occurred as of the proposal’s issuance on August 18, 2026, according to the rulemaking summary page. The comment file is open on the SEC’s website, and the agency will post submissions publicly as they arrive.