- The SEC’s “crypto mom” Hester Peirce is hopeful 2021 will be a turning point for US crypto regulation.
- She said authorities must look at the flipside of cryptocurrencies, rather than focusing on their illicit uses.
- The SEC’s “ever-moving goalposts” are unfair to firms that plan to launch crypto products, she said.
- Sign up here for our daily newsletter, 10 Things Before the Opening Bell.
SEC commissioner Hester Peirce said at a virtual conference last week she hopes 2021 will be a “turning point” for crypto regulation in the US.
Peirce, who has been nicknamed “crypto mom” for her support of digital assets, said US authorities have been spending an unreasonable amount of time focusing on the illegal uses of the technology, rather than on its protective value.
She outlined an exceedingly positive view of cryptocurrencies at the British Blockchain Association’s conference on March 15, saying their ability to function without the need for financial intermediaries could help those “living under the threat of harm by their families, people in their communities, or repressive governments.”
“The disproportionate focus on illicit uses and the underestimation of the protective uses of crypto is one example of how evidence-based rulemaking is not yet the norm in crypto-regulation,” she said. “We can do better, and I hope that this year will mark a turning point for the United States, which in turn may spur other countries similarly to take a more sensible approach to crypto regulation.”
She offered her view on the SEC’s decision-making over approval of crypto exchange-traded products, given that at least 10 firms have filed and so far failed to gain approval for the much-anticipated product. Meanwhile, three exchange-traded funds have already won regulatory approval in Canada.
She said the SEC’s constantly moving goalposts for applicants are “unfair to innovators who spend ever-increasing amounts of money on attorneys and quantitative experts only to find that they have failed to hit a target that has moved once again.”
Peirce thinks regulators should offer more clarity so that traditional financial institutions can engage with cryptocurrencies more confidently. She said massive interest is pressuring the SEC to deal with difficult questions.
“A final regulatory lesson then is that the regulatory work is only just beginning,” she said.