The Securities and Exchange Commission has moved to fill the gap left by a stalled Congress, proposing a tailored securities offering regime for crypto assets after the Digital Asset Market Clarity (CLARITY) Act failed to reach a Senate vote before the chamber’s recess. The agency had initially scheduled an August 14 open meeting to formally launch the rulemaking, only to cancel it a day beforehand — before pressing ahead with the proposal anyway.
The centerpiece is a pair of new exemptions from registration requirements under the Securities Act of 1933, built specifically for investment contracts involving crypto assets. One would let issuers raise up to $5 million over a four-year period; the other would permit raises of up to $75 million in any rolling 12-month period, provided issuers supply financial statements and commit to ongoing reporting. Both exemptions carry principles-based narrative disclosure requirements for investors. The proposal also includes a conditional safe harbor exempting qualifying tokens from being treated as “investment contracts” under both the Securities Act and the Securities Exchange Act of 1934.
One notable omission
Left out of the SEC’s formal proposal was an “innovation exemption” for crypto-based stocks that market participants had widely expected to accompany the offering regime. The gap lines up with reporting that the White House pushed the agency to shelve that piece separately, out of concern it could complicate the CLARITY Act negotiations still pending in Congress. Public comment on the proposal as filed will run for 60 days after it’s published in the Federal Register.
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Industry reaction has been broadly supportive
Coinbase has backed the SEC’s decision to begin rulemaking on its own, while still pressing Congress to pass the CLARITY Act for more durable, legislatively-anchored certainty. The Blockchain Association, in a related filing, has thrown its support behind a separate SEC push to rescind two outdated Regulation National Market System rules, arguing their removal would directly benefit tokenization efforts, and has urged the agency to modernize best-execution standards to formally recognize that securities traded on public blockchains can satisfy existing regulatory requirements.
Congress still hasn’t acted
The regulatory push comes as the legislative track remains stuck. Senate Majority Leader John Thune has filed cloture on a motion to take up the CLARITY Act once lawmakers return in mid-September, but the chamber will have only 14 working days in session before the November election — a tight window that leaves the SEC’s rulemaking as the more immediate, if narrower, path to regulatory certainty for crypto issuers in the meantime.
