In the ongoing battle between hedge funds and regulatory bodies, the U.S. Securities and Exchange Commission (SEC) has proposed new rules to update the definition of 'qualifying' venture capital (VC) funds [b34622d6]. The proposal is a response to a 2018 congressional mandate that called for adjustments for inflation every five years. Currently, qualifying VC funds are excluded from the definition of 'investment company' under the Investment Company Act of 1940. The new rule would raise the threshold for qualifying VC funds to $12 million in aggregate capital contributions and uncommitted capital, up from the current $10 million. The SEC's proposal is subject to a period of public comment and could be modified before any vote on adoption [b34622d6].
This development adds another layer to the ongoing conflict between hedge funds and regulatory bodies. Hedge funds are constantly pushing the boundaries of regulations to maximize their profits, while regulatory bodies like the SEC are tasked with protecting investors and maintaining market integrity. The proposed update to the definition of 'qualifying' VC funds reflects the SEC's efforts to adapt to changing market conditions and ensure that regulations remain effective and relevant [b34622d6].