New Crypto Framework
SEC Unveils Sweeping Regulation Crypto, Targeting Startups and Exchanges for Market Clarity
Key Points
Regulation Crypto would offer temporary registration relief for developers issuing crypto investment contracts and create a safe harbor for issuers transitioning away from managerial control, including defined exemptions, transition periods, and disclosure expectations to move away from an enforcement-heavy approach.
The SEC intends to amend Exchange Act Rules to allow cryptocurrencies to be traded alongside traditional assets on regulated platforms such as ATSs and national securities exchanges to clarify the regulatory framework.
An 'innovation exemption' is being advanced to facilitate trading of tokenized versions of popular Wall Street stocks, with Project Crypto serving as a framework for modernizing digital asset regulation.
The proposed safe harbor framework includes concrete thresholds: startups valued under $5 million in their first four years may qualify, and issuers could raise up to $75 million under qualifying crypto investment contracts; additionally, once developers are no longer driving a project, the token would no longer be treated as a security.
The SEC is preparing to roll out its most sweeping crypto regulatory package yet, with a July 2026 target for the first formal rule proposal, according to MEXC. Called Regulation Crypto, the plan covers startups, token issuers, exchanges, and broker-dealers — and marks a sharp shift away from the enforcement-first approach that defined the agency's recent past.
SEC Chair Paul Atkins is leading the push. The package would create safe harbors for early-stage crypto projects, let crypto trade alongside stocks on regulated exchanges, and give token issuers a clear path out of securities law once a project becomes decentralized, Finance Feeds reported.
Safe Harbors Set Dollar Thresholds for Crypto Startups
The proposed safe harbor framework includes concrete numbers. Startups valued under $5 million in their first four years may qualify for temporary registration relief, according to MEXC. Issuers could also raise up to $75 million under qualifying crypto investment contracts without triggering full securities rules.
There is also an exit ramp built in for developers. Once a team is no longer driving a project — meaning it has become decentralized — the token would no longer be treated as a security. Finance Feeds noted that defined transition periods and disclosure expectations are part of the framework to make this shift orderly.
Crypto and Stocks Would Trade Side by Side on Exchanges
The SEC plans to amend Exchange Act rules to let crypto trade alongside traditional assets on regulated platforms. That includes Alternative Trading Systems, known as ATSs, and national securities exchanges, Benzinga reported. Think of an ATS as a private marketplace that matches buyers and sellers outside of a formal stock exchange.
MEXC described a so-called 'super-app' concept where intermediaries could offer both security and non-security crypto assets in one place. This would let a single regulated platform handle stocks, bonds, and tokens at the same time — something not currently possible under existing rules.
Project Crypto Aims to Tokenize Wall Street Stocks
A joint SEC-CFTC effort called Project Crypto sits at the center of the modernization push. One of its goals is enabling an 'innovation exemption' that would allow tokenized versions of popular stocks to trade on blockchain-based platforms, according to Finance Feeds. Tokenized stocks are digital versions of shares that live on a blockchain instead of a traditional ledger.
Head Topics noted that the broader 2026 regulatory agenda is designed to reduce legal uncertainty and expand institutional participation in digital asset markets. Clear rules around custody — meaning who holds your crypto and how — and fundraising are also part of the package.
Trump Backs Crypto Push, Democrats Raise Alarms
President Donald Trump has made crypto regulation a political priority. He has framed the effort as a way to make the U.S. a global crypto hub. The SEC's move toward formal rulemaking fits that broader White House goal, Finance Feeds reported.
Not everyone is on board. Some Democrats have questioned the pace of the changes and what they could mean for investor protections. The shift from enforcement actions to written rules gives the crypto industry more certainty — but critics argue it may also give bad actors more room to operate before regulators can act.
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