SEC Chair discusses priorities; shutdown continues to prevent them from moving forward

Topline

• Government shutdown enters third week with no resolution in sight

• Carta Policy discusses private market access at DC Fintech Week

• SEC Chairman Atkins outlines priorities on crypto, private markets, and innovative vision for agencies 

• Quick hits

Government shutdown enters week three: Gridlock deepens, impacts spread

Week three of the government shutdown, and Washington is essentially where it started. The House has been in recess since passing a short-term funding patch on September 19, and Speaker Mike Johnson has indicated he will not recall members until there is a clear path to reopen the government. Meanwhile, the Senate has attempted—and failed—ten times to advance the House measure due to Democratic demands to include extensions of Affordable Care Act (ACA) premium subsidies that expire this fall.Both sides are dug in and no closer to a deal than they were on day one.

Here’s where things stand...

Federal workforce: Roughly 1.4 million federal employees are furloughed or working without pay, a reality that was reflected in paystubs this week (except servicemembers). Since last week, the administration has fired over 4,000 federal workers, including targeted layoffs to gut programs it wants to abolish. This includes the Community Development Financial Institution (CDFI) Fund—a public-private partnership that supports small-business lending and community investment in underserved markets. A federal court has temporarily halted some of these layoffs, but the administration has indicated plans to push forward with additional layoffs.

Agency operations: Most agencies are operating at skeleton capacity outside of national security functions:

• The SEC has halted its rulemaking activity and review of public-company filings and registration statements, and staff will not be available to answer questions or provide guidance. The SEC has clarified that companies aiming to go public during the shutdown can do so by removing delaying amendments from registration statements, but should carefully consider the risks associated with doing so. 

• The SBA has stopped processing new loan applications under its 7(a) and 504 programs and SBIC applications, delaying access to capital for small businesses and funds.

• The FTC is still accepting HSR pre-merger filings, which are mandatory for many larger M&A deals. However, staff will not respond to guidance requests or grant early terminations, and parties should expect processing delays and increased uncertainty in review timelines.

• The Census Bureau and Bureau of Labor Statistics have delayed key economic data releases on employment and inflation, leaving policymakers and investors without critical benchmark data.

Even after the government reopens, federal agencies will face considerable backlogs, which will continue to impact agency operations for weeks, if not months. 

Outlook: The shutdown appears likely to extend into November. Both parties believe they are winning the messaging battle so neither side is inclined to blink, and the economic pain is only beginning to surface. But as the shutdown drags on, the political calculus will shift: missed paychecks, declining macro conditions, restricted access to funding, and spikes in health premiums will increase pressure on both sides to come to terms.

To date, President Trump has not engaged in a meaningful way, aside from the administration’s tactics to freeze funding for blue states and fire government workers as leverage against the Democrats. But his involvement will be pivotal if resolution requires Republicans to shift from their current position, particularly if it involves funding ACA subsidies, which have been unpopular with the base.

Carta Policy discusses private market access at DC Fintech Week

Carta Policy was excited to join DC Fintech Week to discuss how policy and technology are reshaping private markets and broadening participation.

Key takeaways:

• For decades, accredited investor rules based on wealth and income thresholds have determined who can participate in private markets, but these measures are a poor proxy for financial sophistication. Expanding accredited investor on-ramps can both broaden investment opportunities and drive more capital to founders and fund managers in emerging ecosystems that lack access to traditional funding networks. 

• Retail access to private capital is expanding. Greater access will necessitate greater transparency around valuations, liquidity, and fees to ensure retail investors have access to quality investments. Carta is building the infrastructure to solve for these friction points. 

• We are at an inflection point. Technology and access are reshaping capital markets, but the policy infrastructure has not kept pace. The regulatory framework should evolve to reflect how innovation is shaping the future instead of solving for problems associated with the public/private dichotomy of the past.

• Engagement matters. Even in a deregulatory environment, this is the time for the ecosystem to help shape sustainable regulation that reflects industry practices and can withstand future political shifts.

Introducing the Securities and Innovation Commission: Atkins outlines priority on crypto, private markets

The government shutdown has prevented the SEC from moving forward on its rulemaking agenda, but it has not stopped SEC Chairman Paul Atkins from discussing his priorities with the ecosystem at DC Fintech Week.

• On crypto: Atkins stated crypto was the agency’s top focus, noting the U.S. was ten years behind in regulating the industry. Instead of regulation by enforcement, he envisions the SEC evolving into the “Securities and Innovation Commission,” paving the way for tokenization and digital assets to reshape markets over the next decade.

• On private markets: Chair Atkins also addressed access to private markets, noting the limitations of the accredited investor standard and how it has prevented many investors from accessing the growth potential in private markets and portfolio diversification opportunities. Atkins discussed the creation of a potential “investor license” and how the agency is working hand-in-glove with the Department of Labor to expand retirement investments in private funds. Atkins reiterated the need for guardrails to ensure “trash” is not dumped into retail markets, focusing on liquidity, accurate valuations, and ensuring investments align with investor expectations.

• On public markets: According to Atkins, litigation, costs of disclosure, and “weaponization” of corporate governance have made it less attractive for companies to go public. Atkins intends to refocus the public regulatory framework around materiality, streamline the proxy process, and revisit quarterly reporting cadence to address concerns related to short-termism.

• On future-proofing SEC rules: Atkins wants to finalize rules that have staying power. Statutory clarity from Congress, broad market adoption, and thoughtful regulation backed by strong economic data will help insulate against future administration shifts.

Quick hits

• Chamber of Commerce sues over Trump’s new $100,000 H-1B visa fee. The lawsuit argues that the move exceeds executive authority and imposes unlawful barriers to hiring skilled foreign workers. The H-1B program is a cornerstone of the U.S. innovation economy, powering venture-backed startups in sectors from software and AI to biotech. A six-figure visa fee could raise labor costs, deter global talent, and squeeze scaling firms that already face tight margins and hiring competition.

• Takeaways for SEC enforcement: Looking back at FY 2025 and the first six months of Chairman Atkins. The Atkins SEC has shifted away from aggressive enforcement of technical compliance violations (e.g. off-channel communications) toward a sharper focus on fraud, insider trading, and investor harm. The agency has also reshaped its enforcement procedures, increasing Commission oversight over investigations, enhancing transparency in the Wells process, and signaling a more cooperative and remedial approach to settlements.

• Barr calls for policymakers to plug gaps in stablecoin bill. Fed Vice Chair Michael Barr warned that the new GENIUS Act leaves key stablecoin risks unresolved—including inconsistent oversight between state and federal regulators, weak reserve and capital standards, and unclear consumer protections. He urged policymakers to close these gaps to prevent regulatory arbitrage and ensure that stablecoins do not replicate the fragility of the pre-crisis shadow banking system

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