The proposal was issued on August 18 and published in the Federal Register three days later. It is not effective law. Public comments remain open through October 20 under file number S7-2026-27.

The small-project route comes with a four-year clock

The proposed startup exemption would allow an issuer to raise an aggregate maximum of $5 million over four years without registering the offering under the standard Securities Act process.

It is designed as a regulatory runway for projects still working toward the managerial promises made to purchasers. It would be a one-time exemption for a crypto asset or a substantially similar asset rather than something an issuer could repeatedly reset.

Issuers would still have disclosure obligations. The SEC wants investors to receive information about the investment contract, the underlying asset, the offering and the essential managerial work the issuer has promised to perform. Federal antifraud and antimanipulation provisions would still apply.

The $75 million route looks much more like regulated capital formation

A separate fundraising exemption would permit offerings of up to $75 million in any 12-month period. At that scale, the proposed regime requires more than a crypto white paper.

Issuers would face financial-statement requirements and ongoing reporting obligations in addition to principles-based disclosures. The structure borrows in part from Regulation A while attempting to account for the unusual lifecycle of investment contracts built around crypto projects.

The SEC is also proposing a qualified-purchaser definition that could preempt certain state registration and qualification requirements for covered offerings and some secondary-market transactions. That would remove one layer of regulatory fragmentation if the provision survives the rulemaking process.

A crypto asset can outlive the securities contract attached to it

That idea sits underneath the entire proposal. The SEC's March 2026 interpretation says a non-security crypto asset can nevertheless become subject to an investment contract when an issuer sells it with explicit promises to perform essential managerial work from which purchasers reasonably expect profits.

The security in that situation is the investment contract. The Commission does not treat that conclusion as proof that the underlying crypto asset must remain a security forever.

Regulation Crypto Assets therefore includes a conditional safe harbor for the other end of the process. An issuer could rely on it after completing or permanently ceasing all of the essential managerial efforts it promised, provided it is not making new promises of that kind.

The proposal also creates a way for the issuer to notify the Commission and the public of that determination and explain its basis. If the conditions are satisfied, the covered investment contract would be deemed to have ceased to exist for the relevant Securities Act and Exchange Act definitions.

The biggest uncertainty sits outside the SEC

Chair Paul Atkins has been previewing this approach since March, arguing that crypto projects need a compliant US fundraising path rather than years of uncertainty about how existing securities rules apply.

He has also acknowledged the institutional limit: an SEC rule is not a substitute for comprehensive legislation. Agency policy can be revised by a future Commission more readily than a statutory market-structure framework enacted by Congress.

For now, none of the proposed exemptions or the safe harbor is final. The next concrete date is October 20, when the public-comment period closes.