Ethereum

The SEC’s Hester Peirce called the regulator’s approach to cryptocurrencies ‘bizarre.’

Hester Peirce, the head of the U.S. Securities and Exchange Commission, took the stage at ETH Denver to continue her criticism of her agency, expressing frustration with “regulation by enforcement” and the SEC slowing its pace on approving a spot Bitcoin ETF. was fiercely criticized.

“The Grayscale case basically gave us the option to approve Bitcoin as an exchange-traded product, and it’s surprising that the court said we have to do that,” Peirce said during a “Fireside” with CNBC’s MacKenzie. He said in a “meeting” conversation. Sigalos. “I started in 2018. That summer, we had our first Bitcoin exchange traded product on commission. And at the time, it was a long time ago now, we thought we should have agreed to this.”

What will the agency say about the currently pending application to offer an Ethereum spot ETF?

“I’m sure people here will be interested to find out what happens next,” she admitted. “Based on the attorney’s response, I would like to say that the SEC is reviewing it. “There’s not much I can say about that.”

One of the many complaints the cryptocurrency industry has aimed at the SEC is that the agency is using enforcement actions instead of regulation to sue cryptocurrency companies like Ripple, Coinbase, and Lbry. Peirce, who regularly speaks at cryptocurrency events and finds a sympathetic audience for his critics, accused the SEC of acting after the fact rather than setting clear regulatory guidelines up front.

“Some of the choices the SEC has made are very strange from the perspective of those who favor regulation as the solution,” Peirce said. “Because pushing a company out of the United States is effectively pushing it out of the control of U.S. regulators.”

Peirce once again suggested that a common sense approach would be better.

“If you really want to sort out good behavior from bad behavior, having clear rules in place for people who want to follow them is a much better approach than forcing them to parachute in later,” she said.

Peirce said cryptocurrency enthusiasts and policymakers should work together to come up with ideas that SEC Chairman Gensler can use to change his views on cryptocurrencies.

“The idea of ​​a token ‘safe harbor’ is to disclose some basic information and then allow time for the project to reach that decentralization point,” she explained. “It’s an idea that people can iterate on, and some people have already done it.”

In October 2021, U.S. Representative Patrick McHenry introduced the Clarity for Digital Tokens Act of 2021. The bill would create a so-called safe harbor, consistent with Peirce’s own proposals, requiring cryptocurrency startups to demonstrate “network maturity” and decentralize to the point that the tokens involved would no longer meet the definition of a security under federal law.

Bitcoin has gained some legitimacy in the eyes of the SEC because it is “sufficiently decentralized.”

Peirce defended the SEC’s fair regulation of cryptocurrencies while also reiterating the SEC’s important role in prosecuting fraud in the cryptocurrency space.

“If you’re talking about scammers scamming people, I think certainly we want to have someone to go after those kinds of people,” she said. “But I still think it would be better to sit down and think about what regulation is appropriate for this area. And it has to be a conversation. It shouldn’t be a one-sided conversation through ‘Read the latest crackdown press releases,’” she said.

Peirce warned investors to seek help from regulators when they make bad trades or decisions.

“What drives me crazy is when people say, ‘Government, step aside,’ and then something bad happens and they say, ‘Government, why didn’t you protect me?’ Why didn’t you tell me not to invest in this?’” Peirce said. “With freedom comes responsibility.”

Edited by Ryan Ozawa.

Stay up to date with cryptocurrency news and receive daily updates in your inbox.

Related Articles

Back to top button