US Securities and Exchange Commission (SEC) Commissioner Hester Peirce has expressed support for a proposed cross-border ‘digital securities sandbox’ between the US and UK.
on wednesday letterSEC Commissioner Peirce praised the Bank of England and the Financial Conduct Authority (FCA) for: propose It is a local “digital securities sandbox” (DSS) that allows participating companies to experiment with blockchain technology in “securities issuance, trading and settlement.”
The sandbox was presented as a testing ground to see if distributed ledger technology could be used to increase the efficiency of existing banking systems, and the commissioner said it should be available to businesses on both sides of the Atlantic.
“Contrary to the proposal, I propose that DSS be opened to American companies,” Peirce wrote. She proposed a “micro-innovation” sandbox where U.S. companies could test their digital trading activities under either U.S. or U.K. regulation. This is still subject to the usual anti-fraud provisions and pre-determined monetary and customer limits.
The SEC and the UK could then share information about activity within both sandboxes and use the findings to develop better regulation for the local cryptocurrency sector.Hester said.
Meanwhile, she said private markets would be freed up by creating space for innovation in “real-world” environments without fear of regulatory crackdowns and creating a path for “small, disruptive companies” to enter regulated markets and compete with large incumbents. I wrote that I would benefit.
“I tend to be more of a beach rather than a sandbox type of regulator,” Peirce wrote, “but sandboxes have proven effective in fostering innovation in highly regulated sectors.” She suggested that cross-border sandboxes could allow for experimentation with “segmentation of assets” and “interoperability between different blockchains and tokens,” among other things.
The proposal is interesting, but unlikely to go anywhere given the SEC’s current leadership, said University of Kentucky professor Bryan L. Frye. decryption.
“I think it’s a good idea, especially because the SEC can learn a lot about regulating cryptocurrency markets by allowing this,” Frye said. “But I’m pretty skeptical that Gensler would support this, so I think it’s very unlikely that will happen.”
Todd Phillips, an assistant professor of law at Georgia State University, agreed: “Commissioner Peirce’s cross-border sandbox proposal has no chance in Chairman Gensler’s SEC.” “The SEC must approve sandboxes, and given that many view regulatory sandboxes as a backdoor vehicle, I don’t think undermining consumer protection laws will bite the Democratic SEC majority.”
Regulatory sandboxes are a common tool used by the World Bank in jurisdictions around the world as “a means of providing a dynamic, evidence-based regulatory environment for testing emerging technologies.” explain. US fintech companies participate 12+ programs At the state level, according to the American Banking Association.
Until recently, the Securities and Exchange Commission (SEC), led by Chairman Gary Gensler, had spearheaded dozens of enforcement actions against cryptocurrency companies for violating securities laws and had turned a deaf ear to industry calls for customized rulemaking.
Regulatory pressure has led many companies to choose to leave the United States for fear of violating regulations. counterattack Against the SEC in court
The political winds have shifted in the direction of cryptocurrencies since the House of Commons earlier this month. bill passed Provides legal clarity for cryptocurrency assets with strong bipartisan support.
Soon after, the SEC quickly decided: Ethereum spot ETF approved For public trading despite overwhelming expectations that it would be rejected.
Edited by Ryan Ozawa.
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