We are not allowing innovation to develop in a healthy way, Hester Peirce fires warning at SEC
May 27, 2022 4:24 AM
Hester Peirce the U.S. Securities and Exchange Commission( SEC) commissioner has advised that the securities market regulator has dropped the ball on crypto regulation citing the need for regulatory transparency of the crypto industry.
SEC Commissioner fires warning' About the ‘ Failure ’ of clarity in crypto regulation
In an interview this week with CNBC at the DC Blockchain Summit, The U.S Securities and Exchange Commission(SEC) Commissioner voiced concerns that the U.S. has dropped the ball on the regulation of cryptocurrencies.
Peirce, who's nicknamed “ crypto mom ” by the crypto community for her support of the industry, discussed challenges in the crypto ecosystem from a regulatory viewpoint. initially, the commissioner mentioned fraud, saying that “ There’s a lot of fraud in this industry because it’s the hot field of the moment. ”
Nevertheless, she stressed that what concerns her further is that the SEC has dropped the ball on crypto regulation. Peirce stated
“We’re not permitting innovation to develop and experimentation to occur in a healthy way, and there are long- term aftereffects of that failure, ” the commissioner advised.
The market downturn was worsened by the collapse of cryptocurrency terra( LUNA) and algorithmic stablecoin terrausd( UST). The two cryptocurrencies lost nearly all value within days. The disaster has urged Congress to call for the instant regulation of stablecoins.
Following the implosion of the terraLUNA and terraUSD, SEC Chairman Gary Gensler advised that a lot of crypto tokens will disappoint and investors will get hurt. He has continually said that a lot of coins listed on crypto exchanges are securities and should be listed with his agency. Still, Gensler also highlighted that the SEC doesn't possess enough resources to sufficiently police financial markets, saying that the regulator is truly “ outpersonned. ” He also said that crypto exchanges trades against their customers frequently.
The SEC under Gensler has so far been hard on cryptocurrencies. Since the securities watchdog launched a unit devoted to crypto asset oversight in 2017, it has brought further than 80 enforcement actions against crypto companies. The agency lately declared that it'll nearly double the size of its Enforcement Division’s crypto unit.
Peirce highlighted the need for regulatory transparency from the SEC, adding that there's a lot of work to be done within existing authorities. Also, Citing that conventional financial institutions want to get involved in crypto, she stressed “ They demand regulatory clarity from us in order to do that. ”