It is a cruel twist of fate that during the first hiatus week in Law Decoded’s existence, the SEC put out long-awaited updates to accredited investor qualifications. Upon reading the news, your faithful and ever-vigilant policy editor put down his phone and cast a wistful eye upon the sun’s reflection dancing in the midground of the Atlantic Ocean. Bracing himself with a deep quaff of Corona, he thought ‘Not today.’ Before the sorrow of not being the one to bring the news to you could overwhelm him, he grabbed a battered borrowed surfboard and made for the waves.
Never one to dwell on the past, I will keep most of this week’s newsletter focused on more recent events. In our continuing mission to boldly present you with only the freshest of takes etc. Last week’s accredited investor shift is too fascinating to pass up, but it ties in with some broader trends about the barrier between public and private markets.
This week has highlighted U.S. federal protection of publicly traded companies, while also amplifying discussion of what exactly public trading should and should not do. It’s an interesting debate in which crypto is a powerful case study. Aside from being a theoretical new monetary system, cryptocurrencies have a reputation for being among the most volatile investments accessible to the general public. In bringing them to heel, the SEC hopes to at least weed out overt frauds and scams.
The flip side is that even without the example of crypto many people criticize the SEC for curating walled gardens of private investment for rich insiders. Crypto evangelists harp on about crypto breaching these walls. They do indeed have a point. But so too does the SEC.