The SEC proposes a door.
$75 million a year, and a way out of investment-contract treatment.
The U.S. Securities and Exchange Commission has proposed a regulatory framework built specifically for crypto projects. Called Regulation Crypto Assets, it would give qualifying companies clearer ways to raise money in the United States without completing the traditional — and often expensive — securities registration process.
The single most important thing to hold on to before reading any further: these rules are proposed. They are not in effect. Nothing described here is available to rely on today, and some of it may never be.
Whyte Consolidated Research · 2026-08-20 · 9 min read · On the proposed crypto framework
Two exemptions from the 1933 Act.
The proposal would create two exemptions from the normal registration requirements of the Securities Act of 1933. They differ in size, in frequency, and in what they ask of the issuer afterwards.
The first would allow a crypto project to raise up to $5 million during a four-year period — a one-time exemption intended primarily for smaller projects and early-stage businesses. The second would allow an issuer to raise up to $75 million during any 12-month period, with additional responsibilities attached: financial statements, and continued filing after the offering.
Both would require issuers to give investors clear information about the project, the crypto asset itself, how the money will be used, and the risks involved. Stated plainly, the SEC is offering crypto companies a less complicated way to raise capital on the condition that they remain honest and transparent with investors. The process shrinks. The duty does not.
Aimed primarily at smaller projects and early-stage businesses.
- ·Clear information about the project and the crypto asset.
- ·How the money raised will be used.
- ·The risks involved in the offering.
For issuers raising at a scale that carries heavier obligations.
- ·Everything required of the smaller lane, plus —
- ·Financial statements provided to investors.
- ·Continued reporting after the offering closes.
The promise ends, and so does the contract.
The proposal also includes what the SEC calls a conditional safe harbor, and this is the part with the longer half-life.
Most crypto projects begin with a central development team. Investors buy tokens because they expect that team to build a network, develop the technology, attract users and, in doing so, increase the token's value. Under existing securities law that arrangement may be an investment contract— and therefore regulated as a security. The dependency on other people's efforts is the thing being sold.
Under the proposed safe harbor, a crypto asset could eventually stop being treated as connected to an investment contract once the issuer has completed — or permanently abandoned — the essential managerial work it promised to perform.
A worked example. A company sells tokens to finance the development of a blockchain network. While the company is building and controlling that network, the token sale may be treated as a securities transaction. Once the network is operating and the company has finished its promised work, the token could potentially qualify for the safe harbor — subject to the project satisfying every one of the SEC's conditions.
What the proposal explicitly does not do is declare cryptocurrency, as a category, to be outside securities law. Each project would have to qualify on its own structure and circumstances.
One filing, not fifty.
The proposed rules would also override certain state securities-registration requirements for qualifying offerings, and for some secondary-market transactions. In practice that means a project using the new framework would generally not need to register the same offering separately in every state.
For a small issuer this is not a minor convenience. Fifty parallel registrations is a cost structure, and one that falls hardest on exactly the early-stage projects the smaller exemption is aimed at.
What preemption does not touch is misconduct. Federal and state authorities could still enforce laws against fraud, misleading statements and other unlawful conduct. The registration requirement is what would be preempted — not the police power behind it.
Uncertainty had already priced itself in.
For years crypto companies have argued that the existing securities rules were written for traditional investments and do not map cleanly onto blockchain networks and digital assets. The argument is contested, but the consequence is not: the absence of clear rules produced behaviour.
Some projects restricted access for American investors. Some moved operations offshore. Some launched anyway and faced enforcement action afterwards — which is the most expensive way to discover where a line was. The proposed framework is an attempt to make the path predictable enough that the answer is known before the raise rather than after it.
- →Lower legal and compliance costs than a full registered offering.
- →Clearer fundraising rules, in place of case-by-case uncertainty.
- →Greater access to American investors for projects that had restricted them.
- →A possible path for a token to move beyond investment-contract treatment.
- →Less pressure to establish operations outside the United States.
Investors would stand to gain something too — more consistent disclosures, and clearer information about the companies and the people behind crypto offerings. Consistency is worth more than volume here; comparability is what a disclosure regime actually buys you.
An exemption is a trade, and someone is on the other side of it.
The proposal could encourage innovation. It also does what every exemption does: it delivers investors less information than a fully registered public offering would. That is not a criticism of the design — it is the design — but it is worth naming rather than glossing.
Exemptions exist precisely because they demand less. Investors in an exempt offering see a thinner disclosure record than in a fully registered public deal — that is the trade being made, and it is being made on their behalf.
Project failure, token-price volatility, dishonest management, cybersecurity failure and limited ability to recover money are unchanged by the existence of an exemption. Smaller or less experienced investors carry them in full.
Whether a development team has genuinely completed its essential work — or quietly continues to control the network — is a question of fact, and a contestable one. Clear conditions and strong fraud enforcement are what keep that line meaningful.
Which is why the detail that will matter most is not the headline number. Clear conditions, reliable disclosures and strong enforcement against fraud are what decide whether a framework like this protects anyone. The $75 million is the part that gets reported. The conditions are the part that does the work.
Sixty days, then a decision that is not guaranteed.
The public will have 60 days following the proposal's publication in the Federal Register to submit comments. The SEC can then revise the rules, adopt them, or decide not to proceed at all.
Even adoption would not settle it. Rules can be challenged in court, changed by a future administration, or overtaken by Congress passing legislation that establishes a more permanent national framework. For now, crypto businesses cannot rely on these proposed exemptions as if they were already law — and any plan that assumes otherwise is planning on a rule that does not exist.
The proposal is published in the Federal Register, which starts the clock.
The public submits comments on the proposed framework and its conditions.
Revise the rules, adopt them, or decline to proceed. None of the three is guaranteed.
Adopted rules could face legal challenge, be changed by a future administration, or be superseded by legislation from Congress.
A narrower door, not an open field.
Regulation Crypto Assets is an attempt to replace regulatory uncertainty with a clearer system. It would let qualifying projects raise as much as $75 million a year without going through the traditional public-registration process, while still requiring disclosure and investor protections. And it would offer a route for certain crypto assets to move beyond investment-contract treatment once their developers have finished the essential work they promised.
Read fairly, the proposal is generally positive for responsible crypto businesses that want to operate in the United States. It is not blanket permission for unregulated token sales, and it does not mean every cryptocurrency stops being a security. Those two sentences will be the ones most often dropped from the coverage, and they are the ones that actually determine who this helps.
The final impact will depend on the conditions written into the completed rules — and on whether the SEC adopts them at all. Until then the honest status of the framework is: proposed.
It is worth noting what this sits alongside. The direction of travel in U.S. digital-asset policy has been toward regulated market infrastructure rather than away from it — settlement, custody and disclosure being pulled into recognisable frameworks rather than left outside them. A fundraising exemption with conditions attached is a piece of that pattern, not a break from it.
Regulation Crypto Assets — questions
- What is Regulation Crypto Assets?
- A regulatory framework proposed by the U.S. Securities and Exchange Commission for crypto projects. It would create two exemptions from Securities Act registration, add a conditional safe harbor under which a crypto asset could stop being treated as part of an investment contract, and preempt certain state registration requirements. It is a proposal only — it is not in effect.
- How much can a project raise under the proposed exemptions?
- Two ceilings. A smaller, one-time exemption would allow up to $5 million raised over a four-year period, aimed primarily at early-stage projects. A larger exemption would allow up to $75 million in any 12-month period, with additional obligations: financial statements and continued reporting after the offering closes.
- Does the proposal mean crypto assets are no longer securities?
- No. The proposal does not declare any cryptocurrency to be outside securities law. It offers a conditional path: an asset could stop being treated as connected to an investment contract once the issuer has completed — or permanently abandoned — the essential managerial work it promised. Each project must qualify on its own structure and facts.
- What is the conditional safe harbor?
- Many crypto projects begin with a central team, and investors buy tokens expecting that team to build the network and increase the asset's value — which can make the arrangement an investment contract. The safe harbor would let the asset move beyond investment-contract treatment once the promised essential managerial efforts are finished or permanently stopped, provided all the SEC's conditions are met.
- Would issuers still have to disclose information to investors?
- Yes. Both exemptions would require issuers to give investors clear information about the project, the crypto asset itself, how proceeds will be used, and the risks involved. The larger $75 million exemption adds financial statements and ongoing reporting. The exemption reduces the process, not the duty to be honest and transparent.
- How does the proposal affect state securities registration?
- It would preempt certain state securities-registration requirements for qualifying offerings and some secondary-market transactions, so a project would generally not need to register the same offering separately in every state. Federal and state authorities would still enforce laws against fraud, misleading statements and other unlawful conduct.
- When would the rules take effect?
- There is no effective date. The public has 60 days from publication in the Federal Register to comment. The SEC can then revise the rules, adopt them, or decline to proceed. Even if adopted, the rules could face legal challenge or be changed by a future administration, and Congress could legislate a different framework. Until then, no issuer can rely on these exemptions.
Related Whyte Consolidated research on digital-asset regulation and settlement:
- Whyte Consolidated — Digital assets as regulated market infrastructure
- Whyte Consolidated — How crypto is quietly saving America
- Whyte Consolidated — BTX: when the block reward is a matrix multiply
- Whyte Consolidated — When software spends: settlement for the agentic economy
Sources: the SEC's official announcement of its proposed Regulation Crypto Assets, and reporting by Bitbo. All figures, thresholds and conditions described here are drawn from the proposal as announced and are subject to change through the comment process; the operative text is the proposed rule itself, not this summary. The framework is a proposal and is not in effect, and no offering may be conducted in reliance on it. Diagrams are illustrative schematics, not data or legal maps. This article is general information about a regulatory proposal. It is not legal, tax, accounting or investment advice, not a recommendation or solicitation to buy or sell any asset, and not an offer of any product. Anyone considering a token offering or an investment in one should take professional advice on their own circumstances.