A senior official with the US Securities and Exchange Commission (SEC) has spoken out against attempts by their regulators to enforce strict regulation of crypto assets instead of promoting self-regulation. The latest statement by Hester Peirce, one of two Republicans among the five SEC commissioners, suggests growing disagreement over crypto policies among the agency’s top executives.
Peirce told According to the Financial Times, she was concerned about the urge by a number of SEC regulators to play a more active role in the cryptocurrency market and how that trend could potentially thwart innovation and discourage investors.
“I am concerned that the first reaction from a regulator is always, ‘I want to take this and do it like the markets I already regulate’.” She said. “I’m not sure this will be great for innovation.”
While Peirce didn’t name commissioners she disagreed with, her comment came in the middle of a campaign Gary Gensler, the new chairman of the SEC, to place crypto assets in a tighter regulatory framework.
On May 26, when Gensler appeared before the subcommittee on financial services and general government of the budget committee of the US House of Representatives, the lower chamber of the country’s parliament, he told lawmakers (again) that cryptocurrencies are a “very volatile and speculative asset class.” “And that many tokens are investment contracts that fall under the US Securities Act.
Regarding the value of the global crypto-asset market, the regulator czar said the reported trading volume figures are not audited or reported to regulators because the exchanges are not registered with them. “This is just one of the many regulatory loopholes in these crypto asset markets.” he said.
Peirce commented on Gensler’s remarks, saying she was “Concerned about trying to make it harder for people to conduct real peer-to-peer transactions” and that she believed that “regulation need not be restricted to government”.
“You can have pretty effective self-regulation,” She said.
And Gensler isn’t the only one pushing for more and stricter crypto regulations. For example, in May, three major federal bank regulators – the Office of the Comptroller of the Currency (OCC), the Federal Reserve, and the Federal Deposit Insurance Corporation – held the first meeting of a “one interagency sprint team” focused on crypto regulation.
Peirce joined the agency in 2018 after being appointed by former US President Donald Trump and was quickly nicknamed “Crypto Mom” for her willingness to advance blockchain technology within a regulatory framework.
Last April, on the initiative of Peirce, an updated version of the Token Safe Harbor proposal was published, which is intended to enable crypto companies to offer tokens as part of Initial Coin Offerings (ICOs) in accordance with the rules of the SEC, something Peirce said of various Praised by representatives of the crypto industry.