The SEC Proposes New Rule for Cryptocurrency Asset Issuance, Introducing Exemption Channel for Select Projects

BlockBeats News, August 19, the U.S. Securities and Exchange Commission (SEC) proposed a new rule framework called "Regulation Crypto Assets," aiming to provide a more flexible regulatory path for digital asset financing, protecting investors while lowering the compliance threshold for some crypto projects.

SEC Chairman Paul Atkins stated that the rule is a "tailored issuance mechanism" designed to support crypto innovation within the securities regulatory framework and advance the modernization of the digital asset market regulatory system.

According to the proposal, the SEC plans to introduce a "Startup Exemption," allowing digital asset issuance projects with fundraising of up to $5 million to be exempt from the registration requirements of the 1933 Securities Act for four years; it also plans to introduce a "Fundraising Exemption," allowing issuances of up to $75 million to obtain an exemption within one year.

Furthermore, the rule includes a safe harbor mechanism, where if a digital asset meets certain conditions and the project team "ceases ongoing managerial efforts," the asset may no longer be deemed a security in the future.

At the time of this rule proposal's release, progress on the U.S. Congress's "CLARITY Act" regarding the digital asset market structure has stalled. The SEC stated that this framework will align with previous digital asset regulatory guidance issued by the SEC and the Commodity Futures Trading Commission (CFTC). SEC Commissioner Hester Peirce stated that this proposal is just the first step towards a "clear, reasonable, and workable" crypto regulatory framework, with a 60-day public comment period.