SEC Commissioner Hester Peirce, Also Known as ‘Crypto Mum’, Urges for Clear regulations.
U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce is emphasizing the importance of regulatory clarity and innovation, emphasizing that these factors create a conducive environment for the growth of the crypto industry.
Peirce’s roadmap
In a recent discussion with CNBC, Pierce critiqued the inadequate regulation of Bitcoin (BTC) and other cryptocurrencies in the U.S., highlighting how this lack of oversight has enabled fraud to flourish while stifling innovation. See video below.
Peirce also underlined the importance of fostering innovation and responsible experimentation in the crypto sector, asserting that a supportive regulatory environment is crucial for the industry’s healthy growth and long-term success.
Additionally, she called for more clarity from Congress on the SEC’s role in overseeing digital assets, suggesting that clear guidance from lawmakers would help delineate the boundaries between traditional securities and digital commodities, thus establishing a more structured regulatory framework.
Peirce also acknowledged the efforts of pro-crypto Senators like Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY) in proposing a comprehensive regulatory framework for the crypto industry, aiming to strike a balance between regulations that encourage innovation and provide much-needed clarity for market participants.
She pointed out the evolving nature of the SEC’s role in regulating cryptocurrencies, emphasizing the agency’s need to adapt to industry changes and develop a more robust regulatory framework to address emerging challenges.
Her insights underscore the significance of effective regulation in shaping the future of cryptocurrencies, balancing investor protection with the promotion of innovation in this rapidly evolving sector.
Peirce calls out SEC
Last year, Peirce expressed her disagreement with an SEC proposal concerning crypto custody.
This proposal aims to expand custody requirements to include crypto assets, potentially limiting the number of qualified crypto custodians. Peirce believes the proposal is overly restrictive and could impede investor access to crypto.
She criticized the SEC’s regulatory approach, accusing them of trying to exert control over crypto without proper jurisdiction.
The proposal has garnered mixed responses, with some commissioners supporting it while others, including Peirce, opposing it. A 60-day public comment period has been instituted to allow stakeholders to share their opinions and suggestions.
During the Duke Conference on Jan. 20, 2023, Peirce addressed the aftermath of the 2022 bear market, which witnessed the downfall of several prominent crypto firms and significant layoffs in the sector. Peirce emphasized the early stage of blockchain technology, arguing that innovative technologies require time to develop and mature.
Last October, Peirce also raised concerns about the SEC’s enforcement action against LBRY, a blockchain company.
Peirce disagreed with the SEC’s case, citing a lack of evidence of fraud and highlighting LBRY’s cautious approach to digital assets compared to other crypto projects. She criticized the SEC’s aggressive stance, particularly the substantial $44 million penalty sought, suggesting that these resources could have been better utilized to establish a regulatory framework for companies like LBRY.
This, she contended, would have allowed market forces to determine LBRY’s fate. The SEC’s enforcement action ultimately led LBRY to cease operations, prompting Peirce to question whether the Commission’s enforcement focus discourages innovation in blockchain technology.
Emphasizing the uncertainty surrounding the future of crypto, Peirce noted that even respected figures in the industry cannot accurately predict its trajectory. She stressed the critical role of industry pioneers in propelling its progress, contrasting them with regulators like herself who lack technical expertise and observe from the sidelines.
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