United States regulator and so-called “crypto mom” Hester Peirce gave remarks in which she expressed fears that the cryptocurrency industry has been hindered by the Securities and Exchange Commission (SEC) dragging its heels. Peirce spoke at the Securities Enforcement Forum in East Palo Alto, California on May 9.
In her speech, Peirce stated that, given the rapid development of the digital currency industry, she worried that the SEC’s hesitance to provide clear guidance would hold back its growth.
The sticking point was, according to Peirce, how to decide when issuing tokens represented an offering of securities, especially considering that securities laws do not cease to apply just because there is a new evolution in the industry.
Peirce says that the SEC, as a regulator, has to provide industry players with clear guidance on how to comply with the law, which the agency has not yet done. She further noted that the agency’s “Jackson Pollock approach to splashing lots of factors on the canvas without any clear message leaves something to be desired.” Peirce continued:
“We should not be trying to guide innovation, but we also should recognize that we cannot stop it and embrace the potential for positive change that innovation offers. Our silence is likely to simply push this innovation and any attendant economic growth into other jurisdictions that have done their work and provided clear guidelines for the market participants to follow.”
The commissioner added, “The U.S. securities markets have historically been the envy of the world; I do not want heel-dragging by the SEC in crypto to mar that well-deserved reputation.”
In March, Peirce argued in favor of self-regulation for cryptocurrency markets when possible, during a public talk together with former Commodity Futures Trading Commission chairman Gary Gensler at the MIT Bitcoin Expo 2019.
At the time, Peirce advocated for a lighter regulatory touch when possible, nonetheless affirming that security offerings must comply with the SEC’s registration requirements. She also supported the ongoing efforts by major crypto trading platforms to register with the agency as either exchanges or as alternative trading venues in order to be able to compliantly list security tokens.
In February, Peirce proposed that the lengthy process of establishing cryptocurrency regulation in the U.S. may ultimately prove to be beneficial and allow more freedom for the industry to come into its own.