Capital markets are the foundation of the American economy. Since the mid-20th century, market transparency, consistent rules, and investor confidence have made the United States the world’s premier destination for capital — a strategic asset without peer.

That asset faces new tests. Half as many U.S. companies are publicly listed today as in the 1990s, and those that do go public tend to do so at far higher valuations, after most of their growth has already happened. Conflicts of interest among those who write the rules have eroded faith in market fairness. The institutional foundations of dollar dominance—reserve currency status and central bank independence—face periodic pressure. And digital assets are emerging as the next generation of financial infrastructure without adequate guardrails.

These challenges are real but solvable. Markets that Americans trust are markets that the world trusts, and preserving that trust is essential to keeping U.S. markets the deepest, most open, and most attractive in the world.

The privatization of investment opportunities

Since the 1990s, the number of publicly listed U.S. companies has fallen by nearly half—from roughly 8,000 to around 4,000. Listing counts never recovered after the dot-com era, even as total U.S. market capitalization climbed to near record highs, leaving public markets increasingly dominated by fewer, larger companies. Meanwhile, the number of private equity-backed U.S. companies has grown more than fivefold, from about 2,000 in 2000 to more than 11,500 by mid-2024.¹ Regulatory burdens and the ready availability of private capital have made staying private more attractive than going public.²

The consequences for ordinary investors are significant. The U.S. stock market has delivered extraordinary returns over the past two decades, but firms now go public later—if at all—meaning a growing share of wealth creation happens in private markets beyond the reach of most American investors. The AI boom illustrates this vividly: OpenAI, Anthropic, and SpaceX are companies collectively valued at several trillion dollars that spent years of extraordinary growth as private firms, inaccessible to retail investors.³

The shift extends beyond equity. Private credit has grown into a $1.5 trillion market that operates with far less transparency—and potentially greater systemic risk—than traditional corporate lending.⁴ The result is a structural gap between what wealthy and institutional investors can access and what is available to everyone else.

Eroding confidence in market integrity

Nothing undermines trust in markets more than questionable conduct from those who write the rules. Members of Congress have repeatedly traded individual stocks while holding information unavailable to the public.⁵ The President and his family members have launched memecoins generating hundreds of millions in fees from undisclosed buyers.⁶ When those in power appear to profit from their rulemaking responsibilities, everyday Americans reasonably conclude that markets are rigged.

Prediction markets have meanwhile opened a new frontier in market integrity concerns. These platforms allow participants to wager on real-world outcomes, from elections and military operations to sporting contests. As their popularity grows, so does the potential for individuals with privileged information to profit at others’ expense. Federal prosecutors recently charged a U.S. Army soldier with using classified information about a planned operation targeting Nicolás Maduro to place successful prediction market bets, generating more than $400,000 in profits.⁷

Each of these developments points to the same problem: a declining trust that the implicit bargain of American capitalism still holds—that markets are open, rules apply equally, and returns flow to those who take genuine risk.

America’s financial leadership is under pressure

America’s financial leadership rests on the dollar’s global reserve status, which confers unique advantages: lower borrowing costs, greater diplomatic and trade leverage and the ability to impose sanctions worldwide. Those advantages depend on global confidence in American institutions—confidence that is no longer automatic.

The dollar’s share of global reserves has declined from 71% in 2001 to 57% today as foreign central banks diversify into gold and other currencies.⁸ Strategic competitors, including China and Russia, have reduced their dollar dependence by settling more of their trade in other currencies.⁹ Rising fiscal deficits, now approaching 6% of GDP, raise questions about long-term dollar credibility.¹⁰ Political pressure on the Federal Reserve has compounded these concerns.¹¹ An unsustainable fiscal trajectory combined with threats to central bank independence risks eroding the perception of U.S. Treasuries as a global safe haven.

Regulatory challenges in digital assets

Digital assets have grown into a multi-trillion-dollar asset class. The infrastructure being built around them, from instant cross-border payments to the tokenization of traditional assets, may define the next generation of global finance. America’s ability to lead that transition depends on rules that create confidence. So far, rules have not kept pace with adoption.¹²

Fraud and market abuse that would trigger immediate enforcement in traditional securities markets go largely unchecked in crypto. The FBI reports that Americans lost over $11 billion to crypto fraud in 2025 alone—through fake investment platforms, romance scams, government impersonation schemes, and other illicit activity.¹³ The basic consumer protections that Americans take for granted in stocks and bonds are largely absent.

Stablecoins illustrate both the promise and the stakes. By enabling instant, low-cost, borderless transactions, stablecoins have become genuinely useful in global commerce, facilitating trillions of dollars in transactions annually.¹⁴ The GENIUS Act, signed into law in July 2025, established the first federal rules for these instruments.¹⁵ Done right, stablecoin regulation is an opportunity: 98% of stablecoins are pegged to the U.S. dollar and 80% of U.S. dollar stablecoin transactions take place outside of the U.S.¹⁶ Clear and credible rules can cement dollar dominance in the next generation of digital finance—while protecting Americans from financial criminals in the process.

Leadership Now believes that America’s capital markets underpin our country’s growth and dynamism. Maintaining their integrity and openness is essential to preserving U.S. economic leadership. Four principles guide our approach:

Leadership Now supports reforms that restore trust in U.S. capital markets, expand access to investment opportunities, preserve America’s financial leadership, and establish clear rules for new financial technologies.

I. Expand Capital Market Access and Opportunity

• Make it easier for firms to go public. The SEC has made reversing the decline in public listings a centerpiece of its agenda, advancing reforms to simplify disclosure requirements and expand smaller companies’ access to streamlined capital raising.¹⁷ We support lowering barriers to going public, but not at the expense of the transparency that makes public markets trustworthy. The SEC’s proposal to make quarterly reporting optional, for example, risks reducing the flow of timely information that ordinary investors depend on.¹⁸ The right balance protects meaningful disclosure for ordinary investors while reducing compliance costs for smaller firms.
• Bring transparency to private markets. Private credit and private equity have grown into markets worth trillions of dollars, yet the funds that specialize in these asset classes are often opaque. Since many underlying businesses and borrowers cannot reasonably bear public market disclosure costs, transparency should come from the funds themselves. The SEC should standardize disclosure of leverage, liquidity, and portfolio concentration so regulators have sufficient real-time data to identify systemic risks before they materialize. As access expands—through channels like the Department of Labor’s proposed rule facilitating 401(k) investments in private assets¹⁹—retail investor protections should strengthen accordingly, including transparent fee disclosures and liquidity terms that match the underlying assets.
• Give every American a stake in our most dynamic companies. One of the most powerful ways to restore trust in capital markets is to ensure every American has a direct stake in them. Policymakers should explore tax-advantaged investment accounts seeded at birth so that every American child can benefit directly from the long-term growth of the U.S. economy. So-called “Trump accounts,” where every child is given $1,000 at birth, offer a promising model.²⁰

II. Enforce Equal Rules for All Participants

• Strengthen insider trading rules for political and government officials. Congress should prohibit officials across all three branches of government, including members of Congress, senior executive branch officials, and federal judges, from owning or trading individual stocks. The same prohibitions should extend to prediction markets on political events.. Leading banks and investment firms already heavily restrict their own employees’ personal trading. Public officials should be held to at least the same standard.
• Apply fraud and anti-corruption laws to memecoin issuance by public officials and their family members. When public officials and family members issue or promote speculative tokens, purchases by those seeking regulatory favor or government contracts create corruption risks that existing laws were not designed to address. The SEC, CFTC, and DOJ should coordinate enforcement against token issuances that function as unregulated influence purchases.
• Protect consumers from crypto fraud. Federal regulators should establish dedicated crypto fraud enforcement, require exchanges to implement fraud monitoring and victim recovery mechanisms comparable to those in traditional financial markets, and close the anonymity loopholes that make crypto the preferred vehicle for scammers and money launderers.
• Draw a clear line between prediction markets and gambling. The CFTC and individual states are currently locked in litigation over who regulates prediction markets, creating regulatory uncertainty that serves no one.²¹ Congress should resolve it by statute: Contracts tied to genuine economic outcomes belong under federal derivatives oversight, while contracts that are functionally sports or entertainment wagering should remain subject to state gambling law. A sports bet should be regulated as gambling whether it takes place in a casino or on an online platform.

III. Preserve America’s Financial Leadership

• Codify Federal Reserve independence. The Supreme Court’s 5-4 ruling in Trump v. Cook in June 2026 affirmed that Fed governors may be removed only for cause and with due process, but stopped short of fully defining cause.²² Congress should finish the job: define clear statutory standards for removal, explicitly exempt monetary policy decisions from executive branch review, and set transparent criteria for Fed appointments that prioritize expertise and independence.
• Complete Treasury market reform. The nearly $30 trillion Treasury market is too important to leave fragile. The SEC should complete the implementation of central clearing for Treasury transactions on its current schedule, improve real-time trade reporting, and strengthen oversight of leveraged positions that have contributed to past market stress.²³
• Implement the GENIUS Act fully and close its remaining gaps. The GENIUS Act established the first federal framework for stablecoins, requiring 1:1 reserves in high-quality liquid assets, certified monthly disclosures, and guaranteed consumer redemption rights. But implementation is behind schedule: regulators missed the July 2026 deadline for final rules, leaving reserve eligibility and custody requirements unresolved as the law’s January 2027 effective date approaches.²⁴ The Act also leaves real gaps, including whether exchanges can pay yield on stablecoin holdings and what standards foreign issuers must meet. Regulators should finish the rules, and Congress should close the gaps.
• Pass comprehensive crypto market structure legislation. The Digital Asset Market Clarity Act was a significant step toward a coherent regulatory framework. The bill passed the House but failed a Senate procedural vote in September 2026, stalled over ethics provisions that did not clearly cover the president, vice president, and their families.²⁵ A final framework should resolve that dispute by extending its ethics rules to the highest offices, require exchanges to register with a primary regulator, mandate segregation of customer assets, and establish consumer protections comparable to those in traditional financial markets. Clear rules keep financial innovation in the U.S.

Together, these reforms will strengthen market integrity, reinforce confidence in the fairness of American capital markets, and help preserve the foundations of U.S. economic leadership for decades to come.

Legislation

Regulatory Actions