Trump-Era Rules Unleash Crypto & Private Credit to Main Street—Advisors Sound Alarm on Retail Risks

Regulatory floodgates swing open—and the rush is on.

The Warning

Financial advisors are hitting the panic button. A suite of rules, born in the previous administration, is now funneling complex, high-risk assets like cryptocurrency and private credit directly to everyday investors. The pitch? Democratized finance. The peril? A retail army marching into a battlefield it doesn't understand.

The New Playing Field

Forget the old guard. These regulations effectively bypass traditional gatekeepers, slicing through red tape that once kept speculative instruments in the institutional domain. It's a direct line from Wall Street's innovation lab to your brokerage account—no PhD in fintech required.

Balancing Act or Ticking Bomb?

Proponents hail it as long-overdue financial liberation. Critics see a recipe for disaster, where volatile digital assets and illiquid private loans could decimate unsophisticated portfolios. It's the eternal finance sector dance: chasing yield while trying not to blow up the dance floor. One cynical take? The only thing 'democratized' so far is the potential for loss—a true equal-opportunity wealth destroyer.

The clock is ticking. The rules are live. And the great American retail experiment is underway, whether your advisor likes it or not.

Washington moves to open markets as regulators push new products

The SEC says it’s still focused on protecting people. Taylor Rogers, a WHITE House spokeswoman, said “Chairman Atkins is committed to making sure that the SEC maintains fair, orderly, and efficient markets while protecting everyday investors.”

But let’s be for real: the door is already being pushed wide open. The Department of Labor confirmed it’s working on new rules for how private assets can be offered to retirement investors.

In August, the TRUMP administration told the Secretary of Labor to team up with the SEC and other agencies to make it easier for individuals to invest in private credit and private equity. Atkins said in November that most retirement plans don’t offer access to these assets, which puts people at a disadvantage.

Right now, retirement plans like 401(k)s mostly stick to stocks and bonds through mutual funds or ETFs. Sure, letting these plans include private credit sounds like a way to diversify, but it also makes one wonder; how will these assets be valued? Can they be sold quickly? Are people even being given decent choices?

These are not small issues for someone trying to retire.

The SEC is also moving fast to unlock more crypto access. In September, it dropped a key hurdle by releasing generic listing standards that speed up the launch of spot crypto ETFs. Since then, new crypto ETFs have been rolling out, and Bitwise Asset Management says another hundred could drop in 2026.

New ETFs and funds raise pressure on retail investors

But with more products comes more risk. Robert Persichitte, a financial planner at Delagify Financial in Colorado, said these new tools might hurt the people with the least experience.

“The little guy… doesn’t have a team of advisors on their side,” he said. He warned that these products aren’t simple, and average investors won’t know how to price or exit them.

Morningstar data confirms the trend. After the SEC’s new rules, crypto ETF launches have jumped. And that’s not the only thing. Interval funds, which invest in private assets, are also rising. These funds are especially being pitched as a fit for retirement plans.

Bryan Armour, a Morningstar analyst, said, “I expect an influx of funds that hold private assets in 2026.”

Just to be clear, ETFs, interval funds, and even target-date mutual funds aren’t risky on their own. No, what matters is what they’re holding inside, and once you start loading them with volatile assets like crypto or hard-to-sell things like private credit, the whole game changes.

Some market players are cheering the changes. Duncan Moir, president of 21Shares, which has launched six crypto ETFs recently, said crypto has “a meaningful role to play in investor portfolios.” But that’s only true if the investor knows what they’re doing. And let’s be honest, most don’t.

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