Coinbase says it wants the Securities and Exchange Commission (SEC) to expand draft fundraising limits for certain offerings involving crypto assets, arguing that broader access could help U.S. retail investors participate in projects sooner.
In an Oct. 20 comment letter, the exchange asked the SEC to let eligible issuers under the proposal offer as much as $120 million in Tier 1 fundraising over any 12-month period, up from the draft’s $20 million ceiling. Coinbase also wants the startup exemption raised to $20 million over four years, from $5 million. For Tier 2, it proposed removing the $75 million limit for issuers that provide audited financial statements.
Under the SEC draft, Tier 1 would allow eligible issuers to raise up to $20 million, while Tier 2 would allow up to $75 million during any 12-month period. Both exemption paths call for narrative disclosures; the larger fundraising exemption also requires financial statements and ongoing reports. Tier 2 financial statements would need to be audited.
Coinbase says projects’ reliance on private fundraising delays U.S. retail access until their networks are operating and can leave early token ownership concentrated. The letter argues the draft’s limits draw on Regulation A, which was designed for smaller operating-company offerings. It also points to past increases in Regulation A’s limits and the initial coin offering period as context for its recommendations. Coinbase presents earlier retail access as a benefit, while issuers seeking uncapped Tier 2 treatment would still face the cost of providing audited statements.
The exchange also asked the SEC to exclude airdrops and distributions tied to activities such as testing or governance from offering limits and filing requirements. For secondary trades, it proposed that certain sales between unaffiliated parties not count as securities transactions when buyers receive no rights under the related investment contract. It also seeks permission for centralized and decentralized platforms to facilitate trades throughout the investment contract’s term.
The SEC still lists Regulation Crypto Assets as proposed after the SEC’s Oct. 20 comment deadline.
