SEC crypto safe harbor proposal submitted for review! Eligible crypto projects can start without registration

SEC Chair Paul Atkins confirms that the crypto safe harbor framework has been submitted to the White House for review, with plans to introduce a new startup exemption and an innovation exemption to reshape the regulatory logic for digital assets.

SEC Chair Paul Atkins confirmed that a proposal for the widely anticipated “safe harbor” framework—allowing eligible projects to be exempt from registration in their early stages—has now been submitted to the White House for review.

On Monday, Paul Atkins said this at a digital assets summit jointly organized by Vanderbilt University and the Blockchain Association, revealing that the proposal, which first surfaced last month, is now in the final review stage within the White House administrative system, with the Office of Information and Regulatory Affairs (OIRA) under the U.S. Office of Management and Budget (OMB) conducting the final checks and review.

We will soon put forward regulatory rules for cryptocurrencies. The proposal is currently in the OIRA review stage, and this is truly exciting as it is the last step before formal issuance.

Among the safe harbor proposal Paul Atkins put forward, the provision that has drawn the most attention from the market is the “Startup Exemption” clause. Its purpose is to allow crypto startups to raise operating funds smoothly while balancing investor protection.

Under the proposal, this exemption would allow crypto projects to launch without immediate registration and to raise a certain amount of capital within 4 years, provided that they must disclose the necessary information.

In addition, Paul Atkins also proposed the concept of an “Investment Contract Safe Harbor,” which would complement the Token Taxonomy guidance SEC released this March. For the crypto industry, the Token Taxonomy guidance is undoubtedly a historic milestone. This is the first time in official documentation that the SEC has clearly defined under what circumstances and conditions digital assets would be recognized as “securities.”

Regulation and obstacles: legislation and administrative rules run in parallel

At the same time that the SEC is actively pushing forward its regulatory framework, the U.S. Congress is also working to regulate the crypto industry through legislation. However, over the past year, the legislative process has been fraught with difficulty and repeatedly faced setbacks.

Paul Atkins said that legislation is necessary because regulatory bodies like the SEC “need a clear and unshakeable (Chiseled in Stone) legal basis.”

He explained that, compared with administrative rules that could change at any time due to shifts in political parties or the inauguration of a new president, only bills passed by Congress through three readings have genuine long-term staying power. He said:

**We can certainly make a lot of efforts on the regulatory front, but in the end we must ensure these rules truly take root and are not easily overturned. **

“Innovation Exemption” sparks a tug-of-war between Wall Street and the crypto world

On the other hand, the SEC is also working on an “Innovation Exemption” mechanism. The idea is similar to creating a “regulatory sandbox” for on-chain assets, allowing industry players to test innovative financial products and services in a controlled environment.

However, over the past year, this exemption concept has sparked intense debate between advocates of cryptocurrencies and traditional financial institutions. Traditional Wall Street forces are concerned that an overly broad exemption could weaken investor protection mechanisms and market oversight.

Citadel Securities, a market maker giant, strongly called for the SEC to develop rules through formal administrative procedures of “Notice-and-comment.” In contrast, the Blockchain Association pushed back on Monday, arguing that cumbersome procedures are not absolutely necessary. It said that the SEC has used exemption mechanisms multiple times in the past and has the authority to exercise that mechanism under the law.

In response, at the summit, Paul Atkins voiced support for the position of the crypto community, clearly stating that the SEC indeed has the authority to push forward an exemption mechanism. He said:

We are going to release the specific details regarding the Innovation Exemption. I’m quite excited about this. In this field, there’s a lot of room for us to pioneer.

• This article is reproduced with authorization from: 《BlockBeats》
• Original title: 《SEC’s “crypto safe harbor” proposal submitted to the White House for review! Chair Paul Atkins: to be rolled out in the short term》
• Original author: Crypto Sister MEL