The US Securities and Exchange Commission has proposed a new rulemaking that would create a "clear and fit-for-purpose framework for certain investment contracts involving crypto assets," moving to fill the regulatory vacuum left after the Senate failed to advance the CLARITY Act market structure bill before its August recess.

The proposal, described by the agency as a "tailored securities offering regime," would allow companies to raise capital with crypto assets while preserving investor protections, according to the SEC's Tuesday notice.

What the Rules Would Do

The framework centers on two mechanisms. First, a safe harbor that would exempt qualifying cryptocurrencies from being treated as "investment contracts" under federal securities law. Second, a set of issuance exemptions that would let token issuers raise up to $5 million over a four-year period, or up to $75 million during any 12-month period.

Token issuers using the exemptions would face real obligations in exchange: audited financial statements and ongoing reporting requirements designed to give investors continuous visibility into the projects backing their tokens.

Notably absent from the proposal was an "innovation exemption" for crypto-adjacent equities that had been widely expected to accompany the announcement.

The public will have 60 days to comment on the proposal once it is published in the Federal Register.

A Regulatory Move With Political Timing

The rulemaking landed days after the Senate failed to advance the Digital Asset Market Clarity Act, the market structure bill that would formally divide oversight responsibilities between the SEC and the Commodity Futures Trading Commission. Majority Leader John Thune has filed cloture to take up the bill when lawmakers return in mid-September, but the calendar is tight: senators have only 14 session days after recess before breaking again ahead of the November election.

SEC Chair Paul Atkins framed the proposal as a bridge, not a substitute for legislation. "Legislation 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," Atkins said, adding that the SEC "has and will continue to support Congress in delivering the CLARITY Act to President Trump's desk."

Atkins had been scheduled to speak at the Wyoming Blockchain Symposium on Tuesday but canceled amid the announcement. White House crypto adviser Patrick Witt told the same event that regulators would "let loose" on crypto rulemaking if Congress cannot move the CLARITY Act forward.

What Comes Next

The proposal now enters the comment period, while the CFTC — the SEC's counterpart in the market structure fight — is scheduled to meet Thursday on crypto, AI and prediction markets, saying it plans to address "areas where regulatory action can complement future congressional legislation."

For token issuers, the practical takeaway is that a workable securities-law path may soon exist regardless of Congress. For the CLARITY Act itself, the clock is now the constraint: if the bill does not pass before a new Congress is sworn in in 2027, the legislative process starts over — and the SEC's framework becomes the industry's de facto rulebook.