SEC Weighs Proposal to Let Some Crypto Startups Raise Capital Without Registering Tokens

The U.S. Securities and Exchange Commission will consider a proposal that could give certain crypto startups a new path to fundraising without registering their tokens as securities. The agency is scheduled to take up the matter at an open meeting on Friday, Aug. 14, at 10 a.m. ET. A Sunshine Act notice dated Aug. 10 indicates the SEC could release a proposed, purpose-built framework for specific digital-asset offerings. If the commission opens the proposal for public comment, it would represent the SEC's first permanent rule aimed specifically at the crypto sector, rather than another nonbinding staff interpretation. The notice does not include potential fundraising limits or other detailed parameters. The initiative has been developing for months under SEC Chair Paul Atkins' "Regulation Crypto Assets" approach, which emphasizes exemptions and safe harbors instead of enforcement-led regulation. Atkins has previously outlined a startup exemption that could run "up to four years," designed to give projects time to develop and potentially reach decentralization before falling outside the SEC's jurisdiction. The move also appears to address the absence of near-term legislative action. The Senate began its August recess without advancing the Digital Asset Market Clarity Act, legislation intended to set clearer legal guardrails for the U.S. crypto market. Following the notice, TD Cowen analyst Jaret Seiberg wrote that the firm sees this as the first of several SEC rulemakings aimed at providing regulatory certainty after the Senate failed to move the Clarity Act before the recess. A formal rule would generally be more difficult to reverse than the series of staff statements issued this year. Those statements clarified the SEC's position on staking, airdrops, and mining but did not establish binding, long-term requirements. A completed "Reg Crypto" framework would remain in effect beyond any single chair's tenure, though passage of the Clarity Act would still be viewed as the most durable solution. The expected framework carries a central tradeoff: projects may be able to raise funds without securities registration, but only if founders reduce or relinquish active control. In practical terms, relief would come once developers are no longer involved in managing the protocol. Separately, the SEC is working on other parts of its crypto agenda, including a joint taxonomy with the Commodity Futures Trading Commission to delineate regulatory responsibilities. The Clarity Act could still see action next month, though prediction market Myriad currently puts the odds of passage this year at 22%. Atkins continues to press an innovation-exemption strategy and a long-promised startup safe harbor, based on staff work underway since spring. The Aug. 14 meeting will be open to the public. If the SEC proceeds to a formal rulemaking, the proposal could materially alter fundraising and compliance decisions for U.S. crypto projects.