SEC Unveils Crypto Fundraising Framework With Registration Exemptions

The SEC has proposed a new rule framework called 'Regulation Crypto Assets' establishing two registration exemptions for crypto fundraising: one allowing issuers to raise up to $5 million over four years and another permitting up to $75 million per 12-month period, with financial disclosures required and audited financials mandated for larger offerings. The proposal includes a safe harbor provision that would exclude tokens from the definition of a security if the issuer has completed or permanently ceased the managerial efforts promised in the investment contract. With comprehensive crypto legislation stalled in Congress, the SEC aims to fill the regulatory gap through its own rulemaking.