Thomas Daniels
Securities and Exchange Commission Chair Paul S. Atkins has unveiled an initiative to expand retail investor access to private equity—an asset class traditionally limited to accredited or institutional participants. This regulatory shift follows an executive order from President Donald Trump, aiming to open 401(k) retirement plans to alternative investments such as crypto and private equity.
Atkins, speaking in a televised interview, highlighted the disparity between institutional investors—such as university endowments and state pension funds—and ordinary Americans whose retirement portfolios are constrained to public markets. “It’s not ideal to have a system where institutional players can diversify broadly, while 401(k) participants are restricted,” he said, adding that the SEC and Department of Labor would coordinate efforts to address this imbalance.
However, Atkins emphasized the need for caution, noting that alternative assets require robust investor protections. “We cannot simply fling the gates open,” he stated, calling for appropriate guardrails to mitigate risks.
The initiative coincides with the SEC’s broader ambition to position the U.S. as a global leader in digital assets. Broader private equity access could enable retail investors to participate in early-stage crypto projects and private token offerings—markets typically beyond their reach.
The SEC previously revised accredited investor rules in 2020, expanding qualification criteria to include individuals with financial expertise, not just wealth. Still, many argue that the current framework remains overly restrictive.
While crypto investors have welcomed the prospect of democratized access, financial experts caution that private markets involve higher risk, limited liquidity, and often lack the disclosure standards of public investments. Missteps in these areas could amplify systemic vulnerabilities during periods of market stress.
