SEC Proposes Regulation Crypto Assets: What Firms Should Know

The U.S. Securities and Exchange Commission (SEC) has proposed a significant new regulatory framework for certain crypto asset offerings.

Issued on August 18, 2026, the proposal, titled “Regulation Crypto Assets,” would establish a tailored offering regime for certain investment contracts involving crypto assets. The proposal includes two exemptions from Securities Act registration requirements, new disclosure requirements, and a conditional safe harbor from the term “investment contract” within the definition of a security.

The proposal is not yet a final rule. The SEC is currently seeking public comment, with comments due 60 days after publication in the Federal Register. Interested parties can submit comments directly to the SEC on Regulation Crypto Assets.

For broker-dealers, investment advisers, crypto asset issuers, and other financial firms involved in digital assets, this is an important regulatory development to follow.

What Is the SEC’s Regulation Crypto Assets Proposal?

Regulation Crypto Assets is designed to create a more tailored framework for certain crypto asset transactions that involve investment contracts.

Under the proposal, qualifying issuers could potentially rely on new exemptions from the registration requirements of the Securities Act of 1933, subject to applicable conditions and disclosure obligations.

The proposal contains two primary offering exemptions:

• An exemption permitting offerings of up to $5 million during a four-year period
• An exemption permitting offerings of up to $75 million during each 12-month period

Issuers relying on the proposed framework would be required to provide principles-based disclosures and would remain subject to federal securities laws governing fraud and market manipulation.

The complete proposal and related materials are available through the SEC’s Regulation Crypto Assets rulemaking page.

Proposed Exemption for Offerings Up to $5 Million

The first proposed exemption would allow qualifying offerings of up to $5 million over a four-year period without registration under the Securities Act.

For smaller crypto asset projects and issuers, a tailored exemption could provide an alternative pathway for raising capital while still requiring compliance with the conditions established by the SEC.

Importantly, an exemption from registration would not mean an exemption from securities regulation altogether. Issuers relying on the proposed regime would still need to satisfy applicable requirements, including the proposal’s disclosure framework.

Proposed Exemption for Offerings Up to $75 Million

The second exemption would permit qualifying offerings of up to $75 million during a 12-month period.

This substantially larger threshold could make the proposed framework relevant to a broader range of crypto asset issuers seeking significant capital without conducting a traditional registered securities offering.

The availability of either exemption would depend on compliance with the conditions ultimately established by the SEC if the proposal becomes a final rule.

Principles-Based Disclosure Requirements

Investor disclosure remains an important component of the proposed framework.

Rather than simply permitting exempt crypto asset offerings without additional obligations, the proposal would require issuers to provide principles-based disclosures.

For issuers and financial firms, this means the proposed exemptions should not be viewed simply as reduced regulation. Firms would still need to evaluate what information must be disclosed and establish processes designed to satisfy applicable regulatory requirements.

For organizations operating within the securities industry, these considerations can also intersect with broader broker-dealer compliance services, particularly where digital asset activities involve regulated securities businesses.

Antifraud and Antimanipulation Rules Would Still Apply

One particularly important point in the SEC’s proposal is what would not change.

Issuers relying on the proposed exemptions would remain subject to the securities laws’ antifraud and antimanipulation provisions.

This means qualifying for an exemption from Securities Act registration would not remove the need for accurate disclosures, appropriate controls, and compliance with other applicable securities laws.

Firms should therefore distinguish between an exemption from a particular registration requirement and exemption from regulatory oversight more broadly.

A Proposed Safe Harbor for Certain Crypto Assets

The proposal also includes a conditional safe harbor from the term “investment contract” in the definition of “security.”

This is another potentially significant component of the proposal.

The regulatory treatment of crypto assets has frequently involved questions about when a particular transaction or arrangement constitutes an investment contract under federal securities law. A conditional safe harbor could provide a defined regulatory pathway for qualifying arrangements that meet the SEC’s requirements.

However, the safe harbor would be conditional. Firms should not interpret the proposal as establishing that crypto assets generally fall outside securities regulation.

Why This Proposal Matters

Regulation Crypto Assets could represent an important development in how federal securities regulation applies to the digital asset marketplace.

If ultimately adopted, the framework could provide qualifying issuers with more specifically defined pathways for raising capital while establishing disclosure and investor-protection requirements tailored to certain crypto asset transactions.

For regulated firms, the proposal is also another indication that digital asset compliance continues to evolve.

FINRA has similarly maintained an active focus on firms’ crypto asset activities. For example, its 2026 information request asked member firms about current and planned digital asset activities. Quadrant previously covered that development in our guide to FINRA’s 2026 Crypto Asset Information Request.

What Should Financial Firms Do Now?

Because Regulation Crypto Assets remains a proposed rule, firms should not treat the framework as though these exemptions or the safe harbor are currently available.

Instead, firms involved with crypto assets may want to:

• Review the proposal and determine how it could affect current or planned activities
• Identify business lines or offerings that could potentially fall within the proposed framework
• Evaluate existing crypto asset compliance and supervisory procedures
• Consider the potential implications for offering and disclosure processes
• Monitor the rulemaking process for changes between the proposal and any eventual final rule
• Determine whether submitting comments to the SEC would be appropriate

Broker-dealers and investment advisers may also want to evaluate digital asset activity within their broader compliance programs and supervisory procedures.

Key Takeaways

The SEC’s Regulation Crypto Assets proposal could create a new regulatory framework for certain investment contracts involving crypto assets.

The most important elements currently include:

• A proposed exemption for offerings of up to $5 million over four years
• A second proposed exemption for offerings of up to $75 million during a 12-month period
• Principles-based disclosure requirements for issuers
• Continued application of antifraud and antimanipulation provisions
• A conditional safe harbor addressing the term “investment contract”
• An active public comment period before the SEC determines whether and how to move forward

For firms involved in digital assets, this is a proposal worth following closely. It could affect how certain crypto asset offerings are structured and how firms approach securities-law compliance in this developing market.

Contact Quadrant Regulatory Group

The SEC’s Regulation Crypto Assets proposal highlights the continued evolution of the regulatory framework surrounding digital assets.

If your firm is evaluating crypto asset activities or needs assistance understanding how changing SEC and FINRA expectations may affect its compliance program, Contact Quadrant Regulatory Group. Quadrant’s team includes former regulators and compliance professionals with experience supporting broker-dealers, investment advisers, and digital asset broker-dealers.