US Securities and Exchange Commission (SEC) Commissioner Hester Peirce says a legal framework is necessary for the crypto sector.
According to of the US SEC commissioner, the agency must establish specific rules for the virtual currency market. In her opinion, regulators need to have a better approach to address the crypto sector. “The SEC can do better,” she claims.
Peirce’s remarks come at a time of uncertainty for the cryptocurrency market. In early June, the agency heavily attacked major trading platforms. Likewise, it classified a significant number of tokens as “securities”.
According to the aforementioned official, aggressiveness should be replaced by a more conciliatory approach. In this sense, she believes that the laws should not assume that everything related to the cryptocurrency market should be classified as a “financial asset.”
The Crypto Sector Needs a Different Approach
So far, the regulatory agency seeks to apply the old securities laws to new digital assets. Consequently, for the SEC, the crypto sector fits perfectly into the securities provisions that were created at the beginning of the 20th century.
This forced adaptation, in the style of the legend of the Procrustean bed, generates tensions between the authorities, on the one hand, and companies and the crypto community on the other. Companies like Coinbase and congressional Republicans strongly criticize the agency for its extremism.
“I think we have to make sure that whatever regulatory framework you have doesn’t just assume that everything is a financial asset,” Peirce asserts. In her opinion, cryptocurrencies go much further than that.
In other words, although these assets are eminently financial, they also have other uses, such as the ability to allow people to interact without the need for a financial entity or intermediary.
Under these premises, the commissioner, also nicknamed “Crypto Mom”, reaffirmed that regulations for the crypto sector must be more open. This view is in stark contrast to that of the SEC and her boss, Gary Gensler. On June 27, Hester twitted the following:
“Protecting investors is important, but the government needs to have a good reason to prevent people from investing their own money as they choose.”
Cryptocurrencies as Social Media Platforms
The crypto sector is not simply a cold financial asset people invest in to win or lose and then withdraw. This usual vision of the traditional financial world is substantially alien to the digital currency ecosystem, as the commissioner hints.
“This is useful in the financial context, but also in building a social media platform or anything else,” he argued. Peirce also took to Twitter to share her SEC statement and make additional comments. Consequently, the commissioner expressed that the protection of investors is something necessary and important.
With this, the expert considers that a framework is needed that is not so inflexible and incapable of adapting to the new uses of cryptocurrencies and the chain of blocks. With this position, the official once again distances herself from the agency’s vision.
Pierce has been critical of the SEC’s move to contain the crypto sector. She claims that laws “can’t be reserved and then all of a sudden [the regulators] return five years later with a bunch of enforcement actions.” With this it is evident that within the agency not everyone is happy with Gensler’s extremist approach.
By Audy Castaneda
