The SEC Just Proposed Its First Major Crypto Rule. Here's What Crypto Investors Need to Know.
This proposed new package of rules would affect the fundraising ecosystem significantly.
Overview
On Aug. 18, the Securities and Exchange Commission (SEC) proposed a sheaf of rules it called Regulation Crypto Assets, which would let crypto projects raise up to $75 million in capital per year without registering the offering as they'd have to do if they were issuing stock as regulated public businesses. That new policy dovetails with an earlier piece of regulatory interpretation of the existing laws published in March by the SEC and the Commodity Futures Trading Commission (CFTC), which categorized 18 of the leading cryptocurrencies as digital commodities rather than securities. The newly proposed SEC crypto rulebook is intended to cover everything that wasn't handled by that first stab earlier in the year, and it's an attempt to create a sensible framework for crypto regulation in the event that the Clarity Act fails to be voted into law later this year.
As sweeping as media accounts of the proposed package make it sound, for holders of leading coins like Bitcoin, XRP, Cardano, and even Dogecoin, the rules are unlikely to change much if they're implemented in their current form. But for Ethereum (CRYPTO: ETH) and Solana (CRYPTO: SOL), among others, the implications could be substantial, albeit indirect, so let's unpack what investors need to know here.
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Originally published at www.fool.com.