New crypto token launches will have higher compliance costs under the US SEC’s proposed “Reg Crypto” rules. Following the landmark joint crypto guidance by the SEC and CFTC, launching altcoins will require securities lawyers, auditors, and a disclosure document, among others.
Crypto Token Launch Rules Under US SEC Reg Crypto Guidelines
The SEC and CFTC released guidance to clarify how federal securities laws will apply to crypto assets. The agency divided crypto assets into five categories, namely digital commodities, digital collectibles, digital tools, stablecoins, and digital securities.
The SEC “Reg Crypto” or safe harbor proposal includes crypto startups’ registration exemption, fundraising exemption, and investment contract exemption. Recently, Paul Atkins confirmed the regulatory framework is under final review in the White House.
Under the new rule, the crypto token launch will require securities lawyers, Big 4 or qualified auditors, a 100-page disclosure document, a legal team, and a decentralization graduation plan.
Alexander Lorenzo, founder and chief investment officer at CoinPicks Capital, said “Before a project sells a single token, they need to have basically $2 million investment for legal infrastructure. Just to be allowed to exist.”
This is part of efforts by Paul Atkins to protect investors by moving away from the 2018-type altcoin launch requirements. Lorenzo claims that anyone with a blog post, a Discord server, and a copied whitepaper could launch a crypto token since 2018. This has zero credibility, no audits, and no accountability.
It will increase compliance costs but reduce risks of rug pulls and scams. The crypto token launch teams that can afford $2 million will have real investors, venture capital, and trades. Some in the community claim it is the first time retail has a real rug filter.
Proposed Safe Harbors and Exemptions
Paul Atkins also plans to provide safe harbors for raising funds and exemptions to innovations such as tokenization under the “Regulation Crypto Assets” framework. Notably, the CLARITY Act has also proposed a capital raising exemption.
Startup exemption provides up to 4 years of relief for early projects, capping raises around $5 million and principles-based disclosures.
The fundraising exemption has higher capital limits of up to $75 million in a 12-month period for more advanced projects. Crypto projects need to file a disclosure document with the commission. Moreover, the investment contract safe harbor provides a clear path to exit securities treatment upon attaining decentralization and functionality goals.
As CoinGape reported earlier, the SEC is also working on a tokenization innovation exemption. It will allow crypto firms and traditional finance to test blockchain-based products, such as tokenized securities, within a supervised sandbox without immediate or full registration.
Also Read: Best RWA Tokenization Compliance Companies & Platforms in 2026
Source: https://coingape.com/new-crypto-token-launches-could-cost-millions-under-secs-reg-crypto-framework/
