Trump's Truth API, SEC Filings May Create Two-Tiered Market

President Donald Trump's media company, TMTG, announced on Thursday the launch of Truth API, a product designed to provide investors with millisecond-faster access to potentially market-moving Truth Social posts. This development arrives as the U.S. Securities and Exchange Commission (SEC) is considering a proposal to allow companies to shift from quarterly to semiannual financial disclosures. These two changes together raise concerns about the potential for a "two-tiered market" in U.S. financial markets, where access to timely information becomes a paid commodity rather than a universally available public good.

Tyler Gellasch, CEO of Healthy Markets Association and a former SEC counsel, stated that "Milliseconds matter in modern markets, and the president’s social media posts move markets." He further elaborated that the Truth API could result in a scenario where "a handful of connected insiders will have the information" while others do not, thereby undermining the fundamental principle of fair access to information that underpins U.S. markets. The Truth Social platform boasts a significant user base, including President Trump with 12.9 million followers, his sons Donald Trump Jr. and Eric Trump, and the White House, all of whom have substantial followings.

Renée Jones, former director of corporation finance at the SEC and a professor at Boston College Law School, indicated that the Truth API could lead to conflicts. The proposed reduction in the frequency of SEC filings from quarterly to semiannual disclosures, if enacted, would further exacerbate the reliance on private information streams. This shift could diminish the regularity of public filings, leaving ordinary investors with less frequent updates on company performance and financial health. The combination of faster access to social media posts and less frequent official disclosures could fundamentally alter the transparency and fairness of U.S. capital markets, potentially making them appear "rigged" to those without access to premium information services.