The Securities and Exchange Commission's proposed Reg Crypto rulemaking — featuring startup exemptions, a $75 million fundraising pathway, and an investment contract safe harbour — has reached the White House Office of Information and Regulatory Affairs, putting it one step from formal publication.
The United States Securities and Exchange Commission is on the verge of publishing what may become the most consequential piece of crypto-specific rulemaking in the agency's history. SEC Chairman Paul Atkins confirmed on 7 April 2026 that the proposed Reg Crypto framework has been transmitted to the White House Office of Information and Regulatory Affairs for review — the final administrative checkpoint before a formal notice of proposed rulemaking can appear in the Federal Register.
The package addresses a question that has dogged the digital asset industry for more than a decade: under what conditions can a blockchain project raise capital without running afoul of federal securities law? Atkins told attendees at a Washington regulatory conference that the SEC expects to release the proposal for public comment within weeks, describing it as the product of months of inter-agency negotiation and extensive consultation with industry participants, investor advocates, and state regulators.
The announcement arrives against a backdrop of accelerating regulatory clarity. The SEC and Commodity Futures Trading Commission jointly issued a five-category crypto taxonomy in March, and the CLARITY Act remains under congressional deliberation. Reg Crypto is intended to complement those efforts by giving entrepreneurs a workable legal pathway to launch tokens and raise funds.
Three Tiers of Fundraising Relief
At the core of the proposal is a three-part framework that creates graduated on-ramps for crypto projects at different stages of maturity. The first tier, dubbed the startup exemption, would allow early-stage developers to raise up to $5 million over a four-year period. Projects relying on this exemption would need to file a notice with the Commission and provide principles-based disclosures similar to the whitepapers already standard in the industry, but would not be required to submit audited financial statements.
The second tier — the fundraising exemption — targets more established projects seeking larger capital raises of up to $75 million within any 12-month window. Issuers at this level would face more structured reporting obligations, including discussion of the issuer's financial condition and the submission of financial statements. Crucially, the exemption would be non-exclusive, meaning issuers could simultaneously rely on other existing exemptions such as Regulation D or Regulation A+.
The third and most closely watched component is the investment contract safe harbour. This mechanism would establish a rule-based test for determining when a crypto asset should no longer be treated as a security — specifically, once the issuer has completed or permanently ceased the essential managerial efforts it promised under the original investment contract. Industry lawyers have long sought such a framework, arguing that many tokens transition from investment contracts to functional network assets over time.
Building on the Hester Peirce Legacy
The safe harbour concept is not new. Former SEC Commissioner Hester Peirce first proposed a token safe harbour in 2020, offering a three-year grace period for network development. That proposal was revised in 2021 but never advanced to a formal rulemaking under the previous administration. Atkins acknowledged Peirce's groundwork, noting that her framework informed several design choices in Reg Crypto.
However, the current proposal differs in important respects. Where Peirce's safe harbour relied on decentralisation as the key criterion for exiting securities treatment, Reg Crypto focuses on the cessation of managerial efforts — a standard that some legal scholars argue is more testable and less subjective. The shift reflects input from the SEC's Division of Corporation Finance and feedback gathered during a series of industry roundtables held in early 2026.
Jake Chervinsky, chief legal officer at the Blockchain Association, called the proposal a watershed moment. He noted that for the first time, the Commission is offering a forward-looking framework rather than relying solely on enforcement actions to define the boundaries of securities law in the digital asset space.
OIRA Review and the Path to Publication
The transmission to the Office of Information and Regulatory Affairs is procedurally significant. OIRA, a division within the Office of Management and Budget, reviews proposed federal regulations for consistency with executive orders, statutory authority, and cost-benefit requirements. The review period typically lasts between 30 and 90 days, although expedited review is possible when the White House signals a policy priority.
President Donald Trump has repeatedly emphasised his administration's support for digital asset innovation, including an executive order in early 2025 directing agencies to develop clear and proportionate crypto regulations. That political tailwind suggests OIRA review could proceed relatively quickly, although objections from the Treasury Department or other agencies could introduce delays.
Once published, the proposal would enter a public comment period — likely 60 to 90 days — during which market participants, consumer groups, and state regulators can submit feedback. A final rule could follow within six to twelve months of publication, depending on the volume and complexity of comments received.
Industry Reaction and What to Watch
Initial reaction from the crypto industry has been overwhelmingly positive, though not without caveats. Paul Grewal, chief legal officer at Coinbase, praised the three-path approach as pragmatic, noting that it recognises the diversity of projects in the ecosystem. Venture capital firm Andreessen Horowitz said in a statement that the startup exemption could reignite early-stage token fundraising, which declined sharply during the enforcement-heavy period of 2023 and 2024.
Consumer advocacy groups have been more cautious. Dennis Kelleher, president of Better Markets, warned that any safe harbour must include robust anti-fraud provisions and meaningful ongoing disclosure requirements. He urged the SEC to resist industry pressure to water down investor protections during the comment period.
Market participants should watch for several key variables in the coming weeks: the exact thresholds and timelines in the published proposal, whether the safe harbour includes a sunset clause, and how the framework interacts with the CLARITY Act and GENIUS Act provisions already moving through Congress. If Reg Crypto reaches a final rule by early 2027, it would represent the most significant expansion of securities exemptions since the JOBS Act of 2012 — and could reshape how blockchain projects around the world approach capital formation.
