At its Sept. 30 meeting, the agency is weighing proposals involving performance-based investment fees, interval and closed-end funds, and potential changes to who qualifies as an accredited investor. The proposals are not final, but together they point toward a broader effort to make private markets more accessible to retail investors.
The timing matters because some of the world’s most valuable companies are staying private for longer. Retail demand for early exposure is already visible in crypto markets, where pre-IPO perpetuals generated roughly $12 billion in monthly volume as traders sought exposure to names such as OpenAI and SpaceX before public listings. Those contracts, however, provide price exposure rather than actual equity ownership.
Accredited Investor Rules Could Broaden
One major area under review is the accredited investor framework.
Today, investors can qualify through income, net worth or certain professional credentials. Expanding the list of accepted certifications could make financial knowledge more important alongside wealth when determining who can participate in restricted private offerings.
That could open private-market opportunities to more investors without eliminating eligibility standards altogether.
The pressure to change the system has grown as private valuations have become increasingly important. Companies can now accumulate tens of billions of dollars in value before going public, leaving most retail investors outside much of that growth.
Crypto markets are already trying to bridge that gap. Coinbase recently launched OpenAI and Anthropic pre-IPO markets for eligible non-U.S. users, showing how demand for private-company exposure is spilling into alternative trading products.
More Access Comes With More Risk
The SEC is also looking at regulated fund structures that can hold less-liquid private assets more easily than conventional mutual funds.
That could allow private equity or private credit exposure to reach investors through familiar investment vehicles rather than direct participation in private deals.
But private assets come with disadvantages. Valuations are less transparent, liquidity can disappear during periods of stress, and fees can be substantially more complicated than those attached to listed stocks or ETFs.
The challenge is especially visible in synthetic private-company markets, where thin liquidity can cause violent price swings. A SpaceX perpetual flash crash recently showed how difficult price discovery can become when there is no deep public equity market underneath the product.
