SEC Commissioner Reveals Reasons For Agency’s Actions As Congress Debate
Hester Peirce, a commissioner with the US Securities and Exchange Commission (SEC), recently stated that regulating the crypto space will be daunting. The commissioner explained that the agency is trying to impose its regulatory oversights following weeks of a crackdown against crypto trading platforms.
Planting A “Regulatory Flag”
According to Hester Peirce, the securities watchdog is moving to “plant its regulatory flag” after a series of crackdowns on crypto exchanges as the US Congress continues to bicker on the next step. Congress still needs to implement comprehensive regulations for the crypto ecosystem as lawmakers continue to debate which agency is the right body to police the industry, according to Peirce.
Since the start of the year, the regulator has been issuing enforcement actions against crypto companies and their key players. So far, the agency has managed to initiate two cases in the last seven days.
Last Thursday, the SEC slammed charges against Do Hyeong Kwon, the CEO of Terraform Labs, over the fallout of the algorithmic Terra USD stablecoin in 2022. The following day, the financial watchdog charged and settled with Paul Peirce, the NBA Hall of Fame Farmer, over allegations of unlawfully advertising a crypto token.
The SEC commissioner explained that the commission would struggle before getting to a stage where it can enforce regulation in the crypto space. Peirce admitted that what will take place in the coming weeks is up to Congress and the agency they pick to regulate the digital asset market.
Lawmakers in the US have proposed comprehensive legislation for the crypto sector and smaller bills to oversee some sections of the crypto market, which will be reintroduced later in the year. Observers believe that some regulations may be on the way following news that Senator Thom Tillis, a Republican lawmaker from North Carolina, is drafting a bill requiring crypto firms in the US to provide verifiable proof of reserves.
Additionally, Elizabeth Warren, the Democrat Massachusetts Senator, has promised to reintroduce a bill to enforce anti-money laundering guidelines for crypto companies.
Divided Opinions
The SEC commissioner is well known to be at odds with her counterparts at the agency. Last week, she was reportedly the only lone voice who voted against the proposed rule leading to strict implementation of crypto custody requirements.
Peirce spoke about how she feels crypto firms would be regulated in the coming years despite the SEC chair, Gary Gensler’s stance about companies applying with the commission for approval.
The SEC official further explained that one of the problems that will occur is that crypto trading platforms are likely to offer assets that no one thinks are securities. Also, the SEC is not used to interacting with businesses that trade securities and non-securities on the same platform.
She believes the next two years will be critical in determining how the industry will evolve.
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