The SEC has proposed letting crypto startups raise up to $75 million a year without full registration, reopening a legal path for public token sales. But Bloomberg reports that the capital and buyer demand that fueled the 2018 ICO boom has largely moved to Bitcoin, AI stocks, and other markets, leaving venture investors divided on whether the same demand still exists.
SEC proposes two fundraising exemptions
The SEC unveiled Regulation Crypto Assets on Aug. 18, creating two exemptions for investment contracts involving crypto assets. An early-stage startup exemption would let projects raise up to $5 million over four years, while a separate fundraising exemption would allow issuers to collect as much as $75 million in any 12-month period.
Both routes would require disclosures to investors. Issuers using the larger exemption would also need to provide financial statements and meet ongoing reporting requirements, and the proposal is now open for public comment for 60 days following Federal Register publication.
ICO-era demand has not returned
Public token sales once let projects raise money on little more than a white paper, and ICOs raised about $3 billion in January 2018 alone at their peak. Failed projects, falling prices, and enforcement actions later ended that cycle.
Investor activity has since concentrated around Bitcoin and a handful of established assets, while speculative traders have turned to perpetual futures, prediction markets, and AI-linked stocks. According to Bloomberg, GSR research analyst Carlos Guzman said "ICOs of 2026 are not the ICOs of 2018."
Bitcoin remained down nearly 10% for 2026 despite a recent recovery, while gold had gained more than 7% for the year. Yet exchange-traded funds tracking gold and Bitcoin attracted a combined record $7 billion over the five trading days through Tuesday, showing demand for crypto exposure persists even as new-token fundraising has cooled.
CLARITY Act still unresolved
The SEC proposal moves separately from the Digital Asset Market CLARITY Act, which would divide digital assets into statutory categories and split oversight between the SEC and the Commodity Futures Trading Commission. Senate Republicans released a 616-page merged draft in July, and the legislation has faced delays in the Senate despite advancing through earlier stages, with Senators Elizabeth Warren and Richard Blumenthal asking the SEC this month to investigate President Donald Trump's memecoin amid disputes over ethics provisions.
Dragonfly general partner Tom Schmidt said market-structure questions have become more pressing for the industry than fundraising rules, arguing the proposal arrives years after it would have helped most.
Source: crypto.news
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