The U.S. Securities and Exchange Commission proposed rules Tuesday that would let public companies report twice a year instead of four times. Under the plan, firms can opt into a new semiannual Form 10-S, replacing the quarterly Form 10-Q. For crypto heavyweights like MicroStrategy and Coinbase, that could mean serious savings on audit and review costs.
Why the SEC moved now
The proposal follows a petition from the Long-Term Stock Exchange, which argued that preparing a single quarterly filing can top 1,000 hours and $100,000. That's for each cycle. Academic work cited in the petition found mandatory quarterly reporting shaved about 5% off small-firm value — suggesting a potential upside for companies that opt out. SEC Chair Paul Atkins said markets will largely self-correct through voluntary updates. The rigidity of current rules, he argued, prevents companies and investors from settling on the right reporting frequency.
The cost argument
It's not hard to see why crypto firms are paying attention. MicroStrategy and Coinbase each incur meaningful audit and review costs every quarter. Under the new framework, they'd file Form 10-S within 40 to 45 days after the first half closes, depending on filer status. That's one filing instead of two per half. The trade-off? Less frequent disclosure could mean thinner analyst coverage, lower trading volumes, and wider bid-ask spreads. Investor advocates point to Europe's move to semiannual reporting, where insider trading convictions ticked up.
The investor concern
Not everyone's on board. Investor advocates warn that semiannual filers could see less attention from analysts and lower liquidity. They also flag the insider-trading risk. Europe's experience with semiannual reporting showed more convictions — not fewer. The SEC's proposing release runs for 60 days of public comment after it's published in the Federal Register. That window gives both sides time to make their case.
What comes next
The comment period hasn't even started yet. Once the proposal hits the Federal Register, the clock ticks 60 days. After that, the SEC decides whether to finalize the rule, tweak it, or drop it. For MicroStrategy and Coinbase, the stakes are clear: less paperwork, but more scrutiny from critics who say less frequent reporting hurts markets. The agency's next move won't come until late summer at the earliest.
