SEC's $75M Reg Crypto proposal could boost Ethereum, Solana, BNB

The U.S. Securities and Exchange Commission proposed Regulation Crypto Assets on Aug. 18, a framework that could reopen token-based fundraising in the United States through two exemptions capped at $5 million and $75 million.

"Reg Crypto offers eligible issuers a clearer route into the market and mitigates the advantage of structuring token offers abroad," Zach Pandl, head of research at Grayscale, said.

The startup exemption allows eligible projects to raise up to $5 million over four years with lighter disclosure requirements. A broader route permits qualifying issuers to raise as much as $75 million within 12 months, subject to audited financial statements and ongoing reporting. Federal antifraud and market manipulation rules continue to apply under both.

Grayscale said clearer rules could bring more token issuers onshore, driving activity across Ethereum, Solana and BNB Chain. The proposal faces a 60-day public comment window after Federal Register publication before any final rule takes effect.

Reg Crypto targets new token offerings, not tokenized stocks

The framework focuses on newly issued crypto assets used for capital formation, distinct from tokenized versions of existing securities. Regulatory uncertainty since the 2017 ICO boom has pushed many token offerings offshore, with newer launches excluding U.S. investors.

Issuers using the larger exemption would publicly file offering documents, including narrative disclosures, details of financial condition and audited financial statements. The proposal would also adjust offering limits for inflation over time without requiring separate notice-and-comment rulemaking each time.

The framework would treat eligible buyers of Reg Crypto assets as qualified purchasers under federal law, preempting state registration and qualification requirements for eligible offers and sales. Some secondary transactions could receive similar treatment if the issuer stays current with filing, disclosure and periodic reporting duties.

Safe harbor offers path for decentralized tokens

Reg Crypto also proposes an investment contract safe harbor. Under certain conditions, an issuer could certify that it has permanently completed or ended the managerial work originally promised to investors, allowing qualifying tokens to move outside investment-contract treatment once networks reach the required stage. SEC Chair Paul Atkins linked the approach to earlier safe-harbor work from Commissioner Hester Peirce.

The proposal builds on a March 2026 interpretation from the SEC and CFTC clarifying how a non-security crypto asset may enter or leave an investment contract, covering airdrops, protocol mining, staking and wrapped assets.

The framework arrives as Congress continues debating the CLARITY Act, which would establish broader federal rules for digital asset markets and divide oversight between the SEC and CFTC. Grayscale said Reg Crypto could address parts of the regulatory gap while congressional negotiations continue, though the proposal must pass through the SEC's rulemaking process before any new exemptions become available.

Should the framework take effect, the return of token-based capital formation to U.S. soil could reshape where projects choose to launch. Grayscale's assessment points to Ethereum, Solana and BNB Chain as the primary beneficiaries, though the final rule's eligibility thresholds and disclosure burden will determine how many issuers qualify. Market participants will be watching the comment period and any congressional movement on the CLARITY Act as the next milestones.

This article is for informational purposes only and does not constitute investment advice.