A commissioner with the U.S. Securities and Exchange Commission (SEC) has referred to as for “a coherent and consistent legal framework that works across all asset classes,” together with crypto property. She warned that the SEC’s present enforcement-centric method would take 400 years to undergo all of the crypto tokens which might be allegedly securities.
SEC’s Commissioner on Crypto Regulation
A commissioner with the U.S. Securities and Exchange Commission (SEC), Hester Peirce, talked about crypto regulation in her speech on the “Digital Assets at Duke” convention on Jan. 20.
Noting that the securities regulator has “pursued registration violations in a seemingly random fashion, often years after the original offering,” the commissioner harassed:
We should develop a coherent and constant authorized framework that works throughout all asset lessons. Our imprecise utility of the legislation has created arbitrary and damaging outcomes for crypto initiatives and purchasers.
“When we insist on applying the securities laws in this manner, secondary purchasers of the token often are left holding a bag of tokens that they cannot trade or use because the SEC requires special handling consistent with the securities laws,” Peirce warned. “Many of these requirements are enforced under a strict liability standard, so clarity is essential.”
The commissioner continued, “Why not set forth a coherent legal framework in a rule?” elaborating:
After all, if we continued with our regulation-by-enforcement method at our present tempo, we might method 400 years earlier than we acquired by the tokens which might be allegedly securities.
“By contrast, an SEC rule would have universal—albeit not retroactive—coverage as soon as it took effect,” she famous.
Commissioner Peirce additional defined: “A rational framework should facilitate the compliance of good faith crypto actors with our securities laws, which would free the SEC to focus more of its resources on the bad faith actors.”
However, she cautioned:
Crypto regulation is just not straightforward to do nicely. If crypto establishments are handled like common depository establishments, requiring heavy layers of capital and plenty of authorized staffing, crypto innovation is more likely to dwindle.
This was not the primary time Commissioner Peirce has raised issues about the way in which the SEC has been regulating the crypto sector. She has repeatedly criticized the securities watchdog for taking an enforcement-centric approach to regulating the crypto area. She additionally believes that the regulator ought to have already authorized a spot bitcoin exchange-traded fund (ETF). In May final yr, she warned that the SEC has dropped the ball on crypto oversight, stating: “We’re not allowing innovation to develop and experimentation to happen in a healthy way, and there are long-term consequences of that failure.”
Commissioner Peirce is just not the one one who is anxious concerning the SEC’s enforcement-centric method. U.S. Congressman Tom Emmer (R-MN), for instance, has repeatedly criticized SEC Chairman Gary Gensler. “Under Chair Gensler, the SEC has become a power-hungry regulator,” the lawmaker mentioned in July final yr.
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