US SEC Plans to Restart Public Token Financing as ICO Market Demand Weakens

The U.S. Securities and Exchange Commission (SEC) has proposed to reopen public token sales to investors, allowing crypto startups to raise up to $5 million, while larger projects can raise up to $75 million annually without completing the full SEC registration process. The new framework requires issuers to disclose information, and compliance costs may be high, while the secondary market trading rules for tokens remain complex. The proposal also allows investment contracts attached to tokens to terminate after the issuer completes or halts its commitments. Market demand has shifted, with speculative funds concentrating on Bitcoin and a few mainstream tokens, perpetual contracts, prediction markets, and AI concept stocks. The number of token financings involving crypto venture capital has significantly declined, with some large VC firms expanding their investment scope to frontier technologies like AI and robotics. In contrast, ICOs peaked in January 2018, raising about $3 billion in a single month. Tom Schmidt, a general partner at Dragonfly, stated that the proposal "is clearly better than nothing," but the more pressing issue is the regulatory matters that the stalled CLARITY bill in Congress should address. GSR research analyst Carlos Guzman pointed out that ICOs in 2026 are different from those in 2018, as the era of attracting funds solely based on white papers and visions has ended.

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