Grayscale Says SEC Crypto Proposal Could Expand U.S. Token Based Fundraising

Grayscale says the SEC’s proposed Regulation Crypto Assets could reopen U.S. token based fundraising, creating new routes for issuers while potentially increasing activity across major public blockchain networks.

Grayscale Sees Potential Boost for ETH, SOL and BNB

Grayscale Research said clearer fundraising rules could encourage more token issuers to operate in the United States rather than structuring offerings overseas. Many newer token launches have excluded U.S. investors because of regulatory concerns.

Grayscale said increased issuance could bring more companies and investors onto public blockchains. The asset manager identified Ethereum, Solana and BNB Chain as networks that could receive more activity if token fundraising expands.

However, that outcome remains uncertain because the SEC has only proposed the rules. Market participants will also need to assess the final eligibility, disclosure and compliance requirements before determining how widely issuers could use the framework.

SEC Proposal Creates New Token Fundraising Routes

TheU.S. Securities and Exchange Commission proposed Regulation Crypto Assets, or Reg Crypto on August 18. The framework would create rules designed specifically for companies raising capital through newly issued crypto tokens.

The proposal differs from tokenized stocks, which represent existing securities on blockchain networks. Instead, Reg Crypto focuses on new token offerings used to raise capital, an area that has faced regulatory uncertainty in the United States since the 2017 ICO boom.

The SEC proposal includes two exemptions. A startup exemption would permit eligible projects to raise up to $5 million over four years with lighter disclosure rules. A broader fundraising exemption would allow qualifying issuers to raise as much as $75 million during a 12-month period.

Projects using the larger exemption would face added disclosure requirements. Those could include financial statements and continued reporting when issuers cross specified fundraising thresholds. Federal antifraud and market manipulation rules would continue to apply.

Safe Harbor Could Address 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.

That process could allow qualifying tokens to move outside investment-contract treatment once their underlying networks reach the required stage. SEC Chair Paul Atkins linked the approach to earlier safe-harbor work from Commissioner Hester Peirce.

The proposal 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. Still, the proposed framework must pass through the SEC’s rulemaking process before any new token fundraising exemptions become available.

For more regulated trading options, investors can explore the best US crypto exchanges operating under current federal guidelines.