US SEC PROPOSES A GROUNDBREAKING REGULATORY FRAMEWORK FOR ENCRYPTION

THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION (SEC) HAS PROPOSED A NEW REGULATORY FRAMEWORK FOR ENCRYPTED ASSETS AIMED AT RESHAPING THE WAY DIGITAL ASSET PROJECTS ARE FINANCED IN THE UNITED STATES. THE PROPOSAL, REFERRED TO AS “ENCRYPTED ASSET REGULATION”, ESTABLISHES A TAILORED SECURITIES REGIME FOR CERTAIN INVESTMENT CONTRACTS, AIMED AT REDUCING REGULATORY BARRIERS WHILE MAINTAINING INVESTOR PROTECTION. THE PROPOSAL INCLUDED TWO NEW EXEMPTIONS FOR THE REGISTRATION OF SECURITIES: ONE ALLOWING THE ISSUER TO RAISE UP TO US$ 5 MILLION OVER FOUR YEARS AND THE OTHER ALLOWING FINANCING TO REACH US$ 75 MILLION IN ANY 12 MONTHS. ISSUERS WHO USE THESE EXEMPTIONS ARE STILL SUBJECT TO DISCLOSURE REQUIREMENTS. THE SEC ALSO PROPOSES A CONDITIONAL SAFE HARBOUR THAT MAY ALLOW CERTAIN ENCRYPTED ASSETS TO BE NO LONGER CONSIDERED “INVESTMENT CONTRACTS”. IN ADDITION, THE PROPOSAL WOULD PRE-EMPT THE REQUIREMENT FOR THE REGISTRATION OF CERTAIN STATE SECURITIES AND WOULD APPLY TO ISSUANCES BASED ON THE REGULATION OF ENCRYPTED ASSETS. ACCORDING TO SEC CHAIRMAN PAUL ATKINS, THE PROPOSAL AIMS TO PROVIDE A CLEARER FINANCING PATH FOR ENCRYPTED ENTREPRENEURS AND ENCOURAGE INNOVATION TO STAY IN THE UNITED STATES. THE PROPOSAL, WHICH IS NOW IN THE 60-DAY PUBLIC COMMENT PERIOD, REMAINS IN ITS STATE AND MAY CHANGE BEFORE THE FINAL ACTION OF THE SEC。