US Securities and Exchange Commission Chair Paul Atkins has proposed a "safe harbor" framework aimed at easing regulatory pressure on crypto firms while keeping them within the federal oversight structure. Speaking at the DC Blockchain Summit in Washington, Atkins said the move would "provide crypto innovators bespoke pathways to raise capital in the US, while providing appropriate investor protections."
Startup and Fundraising Exemptions Detailed
Atkins introduced a "fit-for-purpose startup exemption" targeting early-stage projects, allowing developers to raise limited capital without full securities registration before standard compliance kicks in. Projects would qualify by providing "principles-based disclosures" through public channels, a model aligning with the industry's practice of publishing white papers and technical updates. He described this as a "regulatory runway" for networks to develop.
For more established projects, a "fundraising exemption" was outlined, permitting issuers to raise up to $75 million within a 12-month period while meeting more structured disclosure requirements, including financial documentation. This two-tier approach aims to balance innovation with investor protection.
New Test for Token Security Status
The centerpiece of Atkins' proposal is an "investment contract safe harbor" to determine when a token should no longer be treated as a security. Atkins explained: "This safe harbor could apply once the issuer has completed or otherwise permanently ceased all essential managerial efforts that the issuer represented or promised that it would engage in under the investment contract." The provision seeks to bring certainty to token assessments as projects move toward decentralized structures.
Similar safe harbor calls have previously been made by SEC Commissioner Hester Peirce, who long advocated for a tailored approach giving crypto projects time before full securities regulation. Atkins noted the SEC will soon publish draft rules for public consultation, but emphasized that "only Congress can ensure that regulation in this area is future-proofed through comprehensive market structure legislation."
SEC and CFTC Joint Classification Guidance
Atkins' comments came as the SEC and the Commodity Futures Trading Commission issued a joint interpretation on how crypto assets should be classified under federal law. Atkins clarified that "only one crypto asset class remains subject to the securities laws," identifying it as "traditional securities that are tokenized."
The SEC is also seeking public feedback on proposed changes to Rule 15c2-11, which would limit broker-dealer reporting requirements in over-the-counter markets to equity securities, easing concerns the rule could extend to crypto assets. These steps signal a gradual move toward a more predictable regulatory landscape for the crypto industry.