# SEC's Regulation Crypto Assets: what the $5M and $75M exemptions require > Release 33-11434, at 91 FR 54510, proposes a $5 million four-year startup exemption and fundraising tiers of $20 million and $75 million. Comments close 20 October 2026. - **Source:** https://ptycoin.com/en/posts/2026-10-01-sec-regulation-crypto-assets-33-11434/ - **Published:** 2026-10-01 - **Category:** Policy - **Author:** Diego - **Tags:** regulation, compliance, institutional, latam, fintech - **Also published in:** [Español](https://ptycoin.com/es/posts/2026-10-01-sec-regulation-crypto-assets-33-11434/) --- The Federal Register printed [Release Nos. 33-11434 and 34-106150](https://www.govinfo.gov/content/pkg/FR-2026-08-21/pdf/2026-17183.pdf) on **21 August 2026** as document **2026-17183**, at **91 FR 54510** (File No. **S7-2026-27**, RIN 3235-AN38). The document's action is a proposed rule. Comments should be received on or before **20 October 2026**. The Commission issued the package on 18 August in [press release 2026-76](https://www.sec.gov/newsroom/press-releases/2026-76-sec-proposes-new-regulation-crypto-assets). A [19 August news note](/en/posts/2026-08-19-sec-regulation-crypto-assets/) recorded that announcement. The text that would do the work is proposed **17 CFR part 228**. Part 228 would add two exemptions from Securities Act section 5, a safe harbor for when a covered investment contract is deemed to have ended, and a "qualified purchaser" definition aimed at state registration. The [proposing release](https://www.federalregister.gov/documents/2026/08/21/2026-17183/regulation-crypto-assets) says an issuer that uses either exemption stays under the federal antifraud and antimanipulation provisions. The startup discussion names Securities Act section 17 and Exchange Act section 10. ## What Rule 100 means by a covered investment contract Both exemptions are limited to a **covered investment contract** under proposed 17 CFR 228.100. That is a contract, transaction, or scheme involving a crypto asset that constitutes an investment contract, and it has three limits: a crypto asset is the thing subject to the contract; that crypto asset is not itself a security; and no other asset, security or otherwise, is subject to the contract. A **crypto asset** here is any digital representation of value recorded on a cryptographically secured distributed ledger. The token tied to the contract is the **subject crypto asset**. Rule 100 does not define "investment contract." It points to the Commission's 2026 interpretation, [Release No. 33-11412, 91 FR 13714](https://www.federalregister.gov/citation/91-FR-13714) (23 March 2026). The proposing release describes that test as money invested in a common enterprise, with a reasonable expectation of profits from the essential managerial efforts of others. ## The startup exemption in Rule 200 Proposed **17 CFR 228.200** would exempt a **covered transaction** from section 5 when its conditions hold. A covered transaction is an offer, sale, or other distribution under this exemption. The definition includes a capital raise, and a distribution the rule calls an airdrop, given for use of the associated network or application, or as a reward for operating, governing, or securing it. Those distributions count toward the cap. The cap in Rule 200(b)(4) is a total for the whole window, not a yearly amount. Aggregate offering price of the current covered transaction, plus gross proceeds of earlier and simultaneous covered transactions, must not exceed **$5,000,000**. Non-cash consideration counts, including permitted payment stablecoins. The clock runs from the EDGAR filing of **Form NOR**, a notice of reliance, to the earlier of four years later or the **Form TR** transition report. Form NOR comes first. It would certify that the notice is true and that the issuer intends to fulfill the promised managerial efforts within those four years. The Rule 103 narrative must be free on the website named in the notice for the whole window, with a material year-end change amended within 30 calendar days. Form TR is due no later than four years after Form NOR. Rule 200(b)(3) allows a single use. The issuer and its affiliates must not have relied on it before for the same subject crypto asset, or a substantially similar one, outside this window. The issuer may be an entity, an individual, or a group, and the printed rule has no U.S. incorporation, officer, or asset test. Another exemption you actually meet remains available under Rule 101(a). Rule 104 would import Regulation A's bad-actor bar. Events before the final rule's effective date, still a blank in the draft, would be disclosed to buyers and would not disqualify the issuer. Rule 103, shared by both exemptions, asks for a plain-language account of the contract, the promises, the token, the people, the network, and the specific risks, consistent with the issuer's site and white paper. ## The fundraising exemption, and the U.S. issuer test Proposed **17 CFR 228.300** is the public offering, modeled in large part on Regulation A and filed on **Form 1-CRYPTO**. **Tier 1** is an offering whose aggregate offering price plus aggregate sales, by the issuer and its affiliates, does not exceed **$20,000,000**, including not more than **$6,000,000** from selling securityholders that are affiliates. **Tier 2** uses the same sum at **$75,000,000** and **$22,500,000**. Aggregate sales folds in gross proceeds of other Regulation Crypto Assets offering statements during the prior 12 months and the current offering. On a separate cap, selling securityholders may not make up more than **30 percent** of the aggregate offering price in the issuer's first offering under this section, or in an offering qualified within one year of that first qualification. Rule 300(b)(1) is the test that stops a non-U.S. company at the door. The issuer must be organized under the laws of the United States, a State, a territory, or the District of Columbia. A majority of its executive officers or directors must be U.S. citizens or residents. More than 50 percent of its assets must sit in the United States. The business must be administered principally there. A company organized in Panama, Brazil, Argentina, or El Salvador misses the organization test before the other three are reached. A U.S. subsidiary still has to meet the officer, asset, and administration tests on its own facts. A buyer who is not an accredited investor may purchase only up to **10 percent** of the greater of annual income or net worth, for a person, or revenue or net assets at the latest fiscal year-end, for an entity. Both tiers carry that limit. An accredited investor is outside it. The issuer may rely on the buyer's representation unless it knows, at the sale, that the representation is untrue. No sale before qualification. Rule 304 lets the issuer solicit interest, orally or in writing, before qualification and even before filing. Those communications count as offers for antifraud purposes. Money, other consideration, and any commitment wait until qualification. Tier 2 financial statements in the offering statement must be audited under U.S. GAAS or PCAOB standards by an accountant independent under Regulation S-X Rule 2-01. Tier 1 does not require assurance. Those statements are labeled unaudited, unless a qualifying audit already exists, in which case the issuer files it. Both tiers would file ongoing reports, unlike Regulation A Tier 1: an annual **Form 1-KC**, a semiannual **Form 1-SC**, and current **Form 1-UC**. Rule 305(d) ends that duty when the issuer files Form TR, after the safe harbor is met or after the contract has otherwise ceased to exist. Rule 300(c)(3)(ii) bars an offering at other than a fixed price. These contracts would not be restricted securities, so a buyer could resell at once absent a lockup. The investment contract can still travel with the token until it separates from the issuer's promises. ## The safe harbor in Rule 400 Proposed **17 CFR 228.400** has two conditions. Meet both, and the covered investment contract is deemed to have ceased to exist. The crypto asset is then deemed not to constitute, represent, or be subject to that investment contract for Securities Act section 2(a)(1) and Exchange Act section 3(a)(10). Condition (a): the issuer has completed, or permanently ceased, every essential managerial effort it represented or promised under the contract, and it is not making, and does not intend, any new representation or promise of that kind for the crypto asset. Condition (b): the issuer files Form TR. The release says the form would require a certification that condition (a) holds, and an analysis a reasonable investor can follow. If the issuer used Rule 200 or Rule 300, the measure is the Rule 103(b)(1) account of those promises. Promises to build functionality, with milestones, a timeline, people, and funding, are the efforts that count. Once the network or application works, this release treats securing, maintaining, improving, or sponsoring it as outside those efforts. Rule 400 is open even if the issuer never used the two exemptions, and the 2026 interpretation still describes other ways a contract can end. The Commission could contest a Form TR that gets condition (a) wrong, and a private party could still argue the asset is a security. Where the conditions are actually met, the release says federal securities reporting and registration would stop. ## State registration under Rule 500 Proposed **17 CFR 228.500** defines **qualified purchaser** for Securities Act section 18(b)(3). It covers anyone offered or sold securities in a Regulation Crypto Assets offering. It also covers a person in a trade by someone other than an issuer, underwriter, or dealer, when the issuer has met an exemption under the regulation for that contract and stays current on that exemption's disclosure, filings, or periodic reports. The release says those sales would be covered securities, so state registration and qualification would be preempted. Federal antifraud stays. Secondary-market preemption lasts only while the issuer stays current on the narrative or the reports. ## What is usable before 20 October A sale today still needs an exemption that already exists, or a registration. Part 228 is available only if the Commission adopts a final rule. For a team outside the United States, Rule 200 as printed has no U.S. formation test, and Rule 300 does. Questions 49 and 50 ask whether Rule 200 should be limited to U.S.-formed entities and whether it should add Rule 300's officer, asset, and administration tests or a U.S. principal-place condition. File on **S7-2026-27**, through the [Commission comment form](https://www.sec.gov/comments/s7-2026-27/regulation-crypto-assets) or by email to rule-comments@sec.gov with that file number in the subject. The [rules page](https://www.sec.gov/rules-regulations/2026/08/s7-2026-27) and the [fact sheet](https://www.sec.gov/files/33-11434-fact-sheet.pdf) carry the Commission's own outline. The Senate rejected cloture on [H.R. 3633](https://www.congress.gov/bill/119th-congress/house-bill/3633), the Digital Asset Market Clarity Act, on 15 September 2026, [49 yeas to 50 nays](https://www.senate.gov/legislative/LIS/roll_call_votes/vote1192/vote_119_2_00234.htm). This month's deadline is the proposing release. Payment-stablecoin issuance is a different proposal, [91 FR 53368](/en/posts/2026-09-17-91-fr-53368-genius-issuance-offer-sale/). ## Takeaway Lay Rule 200(b) and Rule 300(b) against the entity that would issue, and write the Rule 103 promises as the list a later Form TR would certify. Comment before 20 October 2026 on the [Federal Register docket](https://www.federalregister.gov/documents/2026/08/21/2026-17183/regulation-crypto-assets). For a sale you are about to make, use the [govinfo PDF](https://www.govinfo.gov/content/pkg/FR-2026-08-21/pdf/2026-17183.pdf) and your own counsel. --- ## Keep reading - [91 Fed. Reg. 53368 would let only permitted U.S. issuers and certain foreign issuers mint payment stablecoins in the U.S., while platforms selling those coins to people located there would face 2027 and 2028 limits if Treasury keeps its location test](https://ptycoin.com/en/posts/2026-09-17-91-fr-53368-genius-issuance-offer-sale/index.md): Treasury's 18 August 2026 proposed rule at 91 Fed. Reg. 53368 (Doc 2026-16796) would implement GENIUS section 3 on issuance and sale of payment stablecoins in the U.S.; comments close 19 October 2026. - [91 Fed. Reg. 37234's PPSI CIP proposal left open whether a secondary-market holder redeeming directly must open an issuer account, and the ABA's 21 August 2026 letter says that cash-out must trigger CIP before dollars move](https://ptycoin.com/en/posts/2026-09-10-91-fr-37234-ppsi-cip-direct-redemption/index.md): ABA's 21 Aug 2026 letter on 91 Fed. Reg. 37234 says every direct stablecoin purchase or redemption must open a PPSI account and run CIP first; Blockchain Association would carve out one-off cash-outs. - [PL 1.536/2023, as substituted by the Senate CCT on 2 September 2026, would put client-asset segregation into Lei 14.478/2022 so exchange-held balances cannot answer for a PSAV's debts, with CAE and CCJ still ahead before it becomes law](https://ptycoin.com/en/posts/2026-09-03-pl-1536-brazil-vasp-client-segregation/index.md): Senate CCT approved a Portinho substitute to PL 1.536/2023 on 2 Sept 2026 that would put client-asset segregation into Lei 14.478/2022. It still needs CAE and CCJ. --- Source: PTYcoin — https://ptycoin.com/en/posts/2026-10-01-sec-regulation-crypto-assets-33-11434/. Free to read and cite with attribution to ptycoin.com. AI-usage terms: https://ptycoin.com/en/ai-usage/