Odaily Planet Daily reports: Galaxy’s Research Director posted on X that the U.S. Securities and Exchange Commission proposed the "Regulation Crypto Assets" (Reg Crypto) on August 18. The proposal aims to establish a legal pathway for certain tokens to be offered to the U.S. public and to create a mechanism for terminating investment contracts. The scope applies only to crypto assets that are not themselves securities but were issued or sold as part of an investment contract; tokenized stocks, bonds, and arrangements that tie tokens to equity or other securities are excluded from the framework.
The proposal outlines four stages: financing, disclosure, construction, and exit. A one-time startup exemption allows issuers to raise up to $5 million over a maximum of four years; a higher-tier exemption, modeled after Regulation A, permits raising $20 million or $75 million within 12 months. Related financing must undergo qualification review by the U.S. Securities and Exchange Commission and require ongoing disclosures. Non-accredited investors are limited to investing no more than 10% of their annual income or net worth, whichever is higher. Issuers must also disclose token supply and release schedule, minting and burning mechanisms, governance and smart contract permissions, source code, and commitments and progress regarding project development.
Once the issuer has fulfilled or permanently ceased its related construction obligations, made no new construction commitments, and submitted a transition report, the relevant investment contract will be deemed terminated, and the crypto asset will no longer be subject to securities laws under that investment contract. Issuers that do not utilize the above financing exemptions may also use this safe harbor. The U.S. Securities and Exchange Commission estimates that approximately 475 issuers per year will use the investment contract safe harbor, and approximately 130 issuers will use the two new exemptions. Eligible issuances may not be considered restricted securities and may be resold immediately without contractual restrictions.
The proposal also exempts initial offerings and certain secondary transactions within its scope from state registration and qualification requirements, but it does not address exchanges, brokers, dealers, custodians, nor is it an independent innovative exemption for tokenized securities or on-chain transactions. The comment period is 60 days following publication in the Federal Register. SEC Chair Paul Atkins and Commissioners Hester Peirce and Mark Uyeda all issued supporting statements. The article was authored by Alex Thorn.