SEC notices orders to let CPAs, Series 79 holders buy private offerings

The Commission has noticed two orders that would widen the private-market buyer list without touching the income and net-worth thresholds. One would let a Certified Public Accountant buy into a private offering on the strength of the credential, and would do the same for Chartered Financial Analysts, Certified Financial Planners and holders of FINRA's Series 79, 86 and 87 licenses. A second proposed notice takes another route to the same status: pass a FINRA exam designed to assess knowledge of various securities and investing topics and you would automatically qualify as an accredited investor, with the test open to anyone over the age of 18. SEC Commissioner Hester Peirce, who described the notices at the Commission's open meeting, said she was pleased to support them.

Regulation D is the pathway that lets companies conduct private offerings without registering them under the federal securities laws, and the accredited investor is the definition that exemption turns on: companies raise money in an unregistered offering from accredited investors, who get access to private investment opportunities generally unavailable to the broader public. As described, the notices leave the securities alone and rewrite the buyer list, which is why the change reaches past the room where it was noticed.

Peirce's case for the change rests on freedom of choice with a portfolio attached: she has never been a fan of paternalistic limits on how Americans invest their own money, and she argued that shrinking the options available to non-wealthy investors shields them from the downside of private markets and, in the same motion, from the upside — from diversification, from helping friends and family start companies, from sharing in a company's growth before it goes public. Private market investments are not right for everyone, she said, but individuals should decide what is right for them, and a government that tells people what they cannot invest in discourages the education and research that make well-informed decisions possible.

The notices, in her reading, recognize that wealth and income are not always great proxies for an investor's sophistication, and that premise is the substance of what the Commission put out: one route swaps a professional credential for the balance-sheet tests, and the other swaps a test of securities knowledge for both the credential and the balance sheet. The hook appears to be Rule 501(a)(10) of Regulation D, which lets the Commission designate qualifying credentials rather than reopen the income and net-worth thresholds set elsewhere in the definition. That reading is an inference from the rule the notices cite — the remarks do not spell out the mechanism — and its consequence is straightforward: the Commission can widen access to private markets on its own authority, without Congress and without touching the dollar figures that usually draw the argument.

The two routes reach different populations: accountants, analysts, planners and the holders of three FINRA licenses have already built careers in or around finance, so adding them to the accredited pool is an incremental change to a list that already contains the wealthy. The exam route reaches further — it would separate accredited status from both a career and a balance sheet, admitting anyone over 18 who can demonstrate knowledge of securities and investing topics. FINRA sits on both prongs of the expansion, its licenses qualifying holders and its exam qualifying passers, and for an organization that already writes many of the licenses the industry hires against, that is a meaningful amount of gatekeeping.

Digital-asset managers have a direct stake in who clears the definition. Private funds that raise from U.S. investors under Regulation D sell into the accredited pool, so the size of that pool sets the ceiling on their buyer list, and each newly qualifying credential holder or exam passer is a likely limited partner in a vehicle sold privately rather than publicly. Spot crypto ETPs sit on the other side of the line, available in ordinary brokerage accounts to anyone who can place a trade, which is why this publication has argued the ETP wrapper is the institutional on-ramp.

A knowledge test carries its own editorial choices about what it covers, how it is scored and what it costs to sit, and those choices would decide whether the exam widens the private market or simply produces a different set of qualified buyers.

The notices also fit a pattern that has held since the Senate's market-structure bill failed 49-50: with legislation unavailable, the definitions that govern crypto and private markets get written at the agencies. The Clarity Act's death left the SEC and the CFTC to answer questions Congress did not, and the accredited investor notices apply the same logic to the demand side of private placements, where the Commission alone can enlarge or narrow the class of Americans allowed to buy what unregistered issuers sell.

The distribution side is being rebuilt at the same time, as Ondo's broker-dealer has joined Fund/SERV, the fund industry's distribution pipe, the first tokenization participant on a network that predates the current debate, with no fund, distributor or launch date attached. Eligibility rules and distribution networks answer the two halves of one question: who may be sold a private product, and how it reaches them.

Both routes now sit with the Commission as contemplated orders, and which of them is adopted — plus how a test open to anyone over 18 would be built — is where the size of the private-market buyer list will be settled.