SEC embroiled in court cases; Hester Peirce says crypto firms shouldn’t give up on US

Hes­ter Peirce, one of five com­mis­sion­ers with the Unit­ed States Secu­ri­ties and Exchange Com­mis­sion (SEC) and an out­spo­ken pro­po­nent of cryp­to, has urged law­mak­ers and reg­u­la­tors for clar­i­ty on dig­i­tal assets.

Speak­ing to Coin­tele­graph at the Per­mis­sion­less II con­fer­ence in Austin, Texas on Sept. 11, Peirce said she wouldn’t have expect­ed the SEC to be “this far behind” in find­ing a solu­tion for a reg­u­la­to­ry frame­work on cryp­tocur­ren­cies when she joined the com­mis­sion in 2018. She point­ed to coun­tries like Switzer­land and Sin­ga­pore as seem­ing­ly ahead of the curve on cryp­to reg­u­la­tions glob­al­ly but said they large­ly couldn’t be com­pared to the sit­u­a­tion in the Unit­ed States. 

“I haven’t seen a lot of changes for the bet­ter,” said Peirce. “You do have a lot of peo­ple who know quite a bit about cryp­to at the agency, whether that’s in Fin­Hub or through­out the divi­sions. You have peo­ple who are actu­al­ly quite knowl­edge­able, and I think that that has changed in the time that I’ve been there.” 

The SEC, under the lead­er­ship of Chair Gary Gensler, has tak­en a lot of crit­i­cism from indus­try lead­ers, reg­u­la­tors and law­mak­ers, often being accused of a “reg­u­la­tion by enforce­ment” approach to dig­i­tal assets. At the time of pub­li­ca­tion, the com­mis­sion was embroiled in civ­il actions against cryp­to firms Coin­base, Binance and Rip­ple and had not approved a spot Bit­coin (BTC) exchange-trad­ed fund (ETF) for list­ing in U.S. mar­kets. In August, Grayscale Invest­ments won an appeal against the SEC’s rejec­tion of its spot ETF appli­ca­tion, which may lead to a review.

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Peirce said she could not com­ment on any par­tic­u­lar court case involv­ing the SEC but urged insti­tu­tions involved in the cryp­to indus­try to com­mu­ni­cate with the com­mis­sion on how to move for­ward. She hint­ed that the agency could have a “change of heart” over cryp­to-relat­ed policy: 

“Don’t give up on the Unit­ed States. This too shall pass, the con­fu­sion shall pass. The Unit­ed States is a good place to build things, and I want it to stay that way. But come for­ward with very con­crete ideas, […] be think­ing of con­crete ways that you need clarity.”

At the time of pub­li­ca­tion, lawyers with the SEC were meet­ing with their coun­ter­parts at Binance.US in a Wash­ing­ton D.C. court­room hear­ing dis­cussing a motion on the need for expe­dit­ed dis­cov­ery in the civ­il suit. The hear­ing fol­lowed Binance CEO Chang­peng Zhao announc­ing Binance.US CEO Bri­an Shroder was “tak­ing a deserved break” from the cryp­to firm amid reports oth­er exec­u­tives at the exchange had departed.

Mag­a­zine: Cryp­to reg­u­la­tion: Does SEC Chair Gary Gensler have the final say?