The rule creates two registration exemptions, a conditional safe harbor once managerial effort ends, and preempts state securities registration. Comment window runs 60 days.
The Securities and Exchange Commission voted on 18 August to propose Regulation Crypto Assets, the tailored securities framework Chairman Paul Atkins has been trailing since March. The draft arrived days after the Commission pulled its scheduled vote without setting a new date, opens a 60-day public comment window, and, if adopted in something close to its current form, becomes the first federal rulebook written specifically for token issuance.
The proposal turns on three moving parts. Two of them are exemptions from the Securities Act's registration requirements. The first is a one-time offering of up to $5 million spread over four years; issuers get lighter obligations but still owe narrative disclosures to investors. The second is bigger and more consequential: up to $75 million every 12 months, with financial statements and ongoing reporting on top of the disclosures. The third piece is a conditional safe harbor that removes a crypto asset from the definition of "investment contract" once its issuer has completed or permanently ceased every essential managerial effort promised in the original offering.
That last provision is what actually resolves the ambiguity Atkins has been chasing. The March interpretation told markets that many tokens sit outside securities law once their networks are sufficiently decentralised, but it did not spell out what sufficient looked like. The safe harbor puts a test around it. No more roadmap, no more promised builds, no more open managerial commitments the issuer is keeping alive. Meet those conditions, and the token itself falls out of the security bucket for good.
The draft also preempts state registration and qualification rules for offerings made under either exemption and for a defined class of secondary transactions. State securities regulators have already begun objecting. The North American Securities Administrators Association has spent 2026 warning that federal pre-emption strips a layer of investor protection that state regulators have historically enforced against small issuers. The proposal keeps state anti-fraud authority intact, but the routine registration piece, which is the actual paperwork most start-ups touch, moves entirely to the federal level.
None of this fixes crypto's registration problem overnight. Sixty days of comment gets the SEC to roughly mid-October before a final rule can even be drafted, and any adoption would then need to survive a Federal Register cycle and the near-certain litigation that follows any preemption of state authority. The CLARITY Act, which would have handled parts of the same problem through statute rather than rulemaking, was never brought to a Senate vote before the August recess and cannot return before September at earliest.
Atkins is running the process anyway. His statement framed the proposal as an effort to onshore issuance activity that has migrated to jurisdictions with clearer rules — a diplomatic way of saying US-domiciled projects have been raising abroad because raising at home was legally impossible. The Commission's numbers back this. The March interpretation and the exemptive orders that followed have not been enough to reverse the outflow of new issuance to Zug, Singapore and Abu Dhabi.
The scale of the exemptions matters. A $75 million ceiling every year is meaningful. Regulation A+, the SEC's existing exemption most token issuers have historically been forced into, tops out at $75 million as well but requires full financial statements, extensive narrative disclosure, and a qualification process that has taken 12 to 18 months in practice. The new second-tier exemption asks for financials and reports too, but the entire point of writing a bespoke framework is that the qualification burden is calibrated for a token issuer rather than for a small-cap equity float.
The Commission is unlikely to get the safe harbor language through comment unchanged. Every prior attempt to define when a network has become sufficiently decentralised has drawn detailed pushback on which specific conditions matter and how they get proven, from the 2018 Hinman speech to Commissioner Peirce's original token safe harbor in 2020 to the March interpretation itself. The draft's version is more restrictive than Peirce's original; it demands cessation of managerial effort rather than the passage of time she wrote in. Industry comment letters will argue the test as written is too narrow. State regulator letters will argue it is too broad.
None of that stops the countdown. The comment window opens once the release hits the Federal Register, and the clock on the biggest US crypto rulemaking of the Atkins era starts from there.
