On December 2, SEC Chairman Paul Atkins stood at the New York Stock Exchange and delivered a speech that could reshape how private companies approach disclosure requirements. While much of the media coverage focused on his critique of regulatory overreach and nod to crypto-friendly policies, one section of his remarks deserves closer attention from the investment crowdfunding and private securities community.

Atkins outlined two core principles for reforming SEC disclosure rules: first, that requirements should be “rooted in the concept of financial materiality,” and second, that they “must scale with a company’s size and maturity.”

For anyone watching the secondary trading space for Regulation Crowdfunding, Regulation A+, and Regulation D securities, these aren’t abstract policy musings. They strike at the heart of a structural problem that has constrained liquidity for years.

The Secondary Trading Bottleneck

Here’s the challenge. When a company raises capital through an exempt offering, the securities issued are generally restricted. Investors who want liquidity before an exit event face a maze of compliance requirements—most notably, Rule 15c2-11 under the Exchange Act and the patchwork of state Blue Sky laws that govern secondary transfers.

For a company to have its shares trade on an Alternative Trading System, current financial and company information must be publicly available. Historically, that meant either becoming a public reporting company (expensive and burdensome) or filing with one of two National Securities Manuals—Mergent or OTC Markets—neither of which was designed for small private issuers.

This created an odd asymmetry: the JOBS Act made it easier to raise capital, but did little to address what happens after the raise when investors want out.

A Framework That Already Exists

What’s notable is that a disclosure framework scaled for private company secondary trading already exists and is recognized by 43 states through the Manual Exemption.

GUARDD, a compliance platform launched in 2020 by several architects of the original JOBS Act crowdfunding framework, was designed specifically for this gap. The platform enables Regulation A+, Regulation Crowdfunding, and Regulation D issuers to publish ongoing disclosures that satisfy both Rule 15c2-11 requirements and state Blue Sky laws, allowing their securities to trade on ATSs.

The disclosure requirements are calibrated for private companies—covering material company and financial information without the volume demanded of public filers. Companies like Masterworks and Collectable have used the service to enable secondary trading of fractionalized alternative assets.

Atkins’ Vision Aligns With What’s Already Working

Chairman Atkins’ critique of disclosure “unmoored from materiality” and his call for requirements that scale with company size describes, in policy terms, what the Manual Exemption and platforms like GUARDD have operationalized in practice.

Consider his remarks about the current regime: disclosure rules have been “hijacked to require information unmoored from materiality,” resulting in “reams of paperwork that can do more to obscure than to illuminate.” His proposed solution—a “minimum effective dose of regulation”—mirrors the approach private company disclosure frameworks have already adopted by necessity.

Atkins also signaled interest in building on the JOBS Act’s “IPO on-ramp” concept, potentially extending accommodations for emerging growth companies. For the exempt securities market, this suggests an appetite for revisiting how disclosure scales across the capital formation lifecycle—from initial offering through secondary liquidity.

Issuers Don’t Need to Wait

The policy debate will unfold over months or years. Rulemaking is slow. But for issuers who raised capital under Regulation Crowdfunding, Regulation A+, or Regulation D and want to offer investors a path to liquidity, the infrastructure already exists.

The Manual Exemption provides a recognized pathway in 43 states. Ongoing disclosure platforms have processed hundreds of securities. Alternative Trading Systems are operational and accepting listings from compliant issuers.

Whatever emerges from the SEC’s reform agenda, companies that establish disclosure practices now will be positioned ahead of the curve—and their investors won’t have to wait for Washington to act before they have options.

The exempt securities market has long operated in the gap between policy aspiration and regulatory reality. Chairman Atkins’ speech suggests that gap may narrow. In the meantime, the market has already built its own solutions.