SEC proposes new crypto rules in absence of CLARITY Act

cointelegraphPublished on 2026-08-18Last updated on 2026-08-18

Abstract

The U.S. Securities and Exchange Commission (SEC) has proposed new rules for crypto asset investment contracts, citing the failure of Congress to pass the CLARITY Act. The rules aim to establish a tailored securities offering regime, allowing entities to raise capital with investor protections. They do not include an expected "innovation exemption" for crypto stocks. The proposal offers exemptions permitting crypto companies to issue up to $5 million in tokens over four years and $75 million in 12 months, with a safe harbor from "investment contract" classification. Issuers must provide financial statements and comply with ongoing reporting. A 60-day public comment period will follow. SEC Chair Paul Atkins stated that while the SEC supports the CLARITY Act, legislation is still needed for durable rules. The announcement preceded a CFTC meeting on crypto regulation. With the Senate in recess, the CLARITY Act faces a tight timeline for a vote before the new Congress is sworn in.

The US Securities and Exchange Commission (SEC) has proposed new rules that could affect the cryptocurrency industry after lawmakers in Congress failed to pass a market structure bill before breaking for a month-long recess.

In a Tuesday notice, the SEC said that the agency proposed rules to create a “clear and fit-for-purpose framework for certain investment contracts involving crypto assets.” According to the regulator, the “tailored securities offering regime” would allow entities to raise capital while preserving investor protections.

The agency’s rules did not include an “innovation exemption” for crypto-based stocks, which had also been expected to be announced. Notably, the proposed rules came just days after the US Senate failed to advance the Digital Asset Market Clarity (CLARITY) Act, a bill expected to clarify the roles federal agencies would have in overseeing and regulating crypto.

“[L]egislation remains indispensable to enacting ‘future-proofed’ rules of the road that are durable enough to protect the work we are undertaking today from being unwound by a future rogue regulator,” said SEC Chair Paul Atkins. “The SEC has and will continue to support Congress in delivering the CLARITY Act to President Trump’s desk.”

According to the proposed rules, crypto companies would be offered exemptions allowing the issuance of up to $5 million in tokens during a four-year period and up to $75 million during a 12-month period, as well as a safe harbor exempting cryptocurrencies from being treated as ”investment contracts.” Token issuers would be required to make financial statements and “would be subject to ongoing reporting requirements.“

The public will have 60 days to comment on the proposal after publication in the Federal Register.

Related: CLARITY or not, crypto isn’t going back in the bottle: Bitwise

The SEC’s proposed rules in the absence of legislation from Congress came ahead of a scheduled Thursday meeting of the US Commodity Futures Trading Commission (CFTC) on crypto, AI and prediction markets. The commodities regulator said it planned to address “areas where regulatory action can complement future congressional legislation.”

Atkins had been scheduled to speak at the Wyoming Blockchain Symposium on Tuesday, but canceled amid the SEC announcement. White House crypto adviser Patrick Witt said at the event that US regulators would “let loose” on crypto regulation if Congress was unable to move forward on the CLARITY Act.

CLARITY’s chances before a new Congress is sworn in?

Before the Senate broke for its August state work periods, Majority Leader John Thune filed cloture on a motion to take up the CLARITY crypto bill when lawmakers return in mid-September.

Following the August recess, senators only have 14 days in session before breaking again ahead of the November election. If Thune and Republican lawmakers can’t get a floor vote before then, the Senate has another 22 days in session before 2027, when new members of Congress will be sworn in.

Magazine: Will the crypto lobby’s $189M campaign get CLARITY over the line?

Related Questions

QWhat is the main reason the SEC proposed new rules for the crypto industry?

AThe SEC proposed new rules after lawmakers in Congress failed to pass the CLARITY Act, a market structure bill, before breaking for a month-long recess.

QWhat is the purpose of the SEC's proposed 'tailored securities offering regime'?

AThe purpose of the proposed 'tailored securities offering regime' is to create a clear and fit-for-purpose framework for certain crypto asset investment contracts, allowing entities to raise capital while preserving investor protections.

QWhat are two key exemption limits for crypto companies under the SEC's proposed rules?

AUnder the proposed rules, crypto companies would be allowed to issue up to $5 million in tokens during a four-year period and up to $75 million during a 12-month period. The rules also include a safe harbor exempting cryptocurrencies from being treated as 'investment contracts.'

QAccording to SEC Chair Paul Atkins, why is legislation like the CLARITY Act still necessary?

ASEC Chair Paul Atkins stated that legislation remains indispensable to enact 'future-proofed' rules that are durable enough to protect current regulatory work from being unwound by a future rogue regulator.

QWhat did White House crypto adviser Patrick Witt say would happen if Congress failed to advance the CLARITY Act?

AWhite House crypto adviser Patrick Witt said that U.S. regulators would 'let loose' on crypto regulation if Congress was unable to move forward on the CLARITY Act.

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