'Very Pared Down': SEC Exemptions for Crypto a Boon for the Industry, Lawyers Say

David Fredrickson’s commentary was included in an article appearing in The National Law Journal in an article examining the SEC’s proposed Regulation Crypto Assets, which would create new exemptions for crypto fundraising and establish a pathway for certain digital assets to transition out of securities status.

David believed that the proposal is “pretty mainstream” and rooted in existing regulatory frameworks. He emphasized that “It’s not a free-for all” and added, “I don’t think that this is some radical proposal.”

Discussing the proposal’s safe harbor provision, David said it creates “an exit strategy at some point” for some digital assets once they become decentralized: “It’s just a token. You’re no longer offering a security. It’s not acting like an investment contract.”

He also noted that important questions remain regarding the regulation of secondary market trading of crypto assets, explaining that regulators will need to address issues such as broker involvement and exchange trading requirements. “The initial sale is important, but you then want to be able to buy and sell it mostly freely,” David added.