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Pro-Crypto SEC Commissioner Slams Agency’s Regulatory Approach

Pro-Crypto SEC Commissioner Slams Agency’s Regulatory Approach

key takeaways

  • Pro-crypto SEC Commissioner Hester Pierce issued a public statement on Wednesday criticizing the agency’s new regulatory agenda.
  • Commissioner Pierce called the SEC’s regulatory approach “flawed” and dangerous to the nation’s capital markets.
  • He also criticized the SEC’s attempt to regulate decentralized finance without addressing the primary needs of the crypto industry.

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Hester Pierce has issued a public statement criticizing the new regulatory agenda of the US Securities and Exchange Commission. He described the agency’s approach as “flawed” and dangerous for the country’s capital markets.

commissioner Pierce Blasts SEC’s Agenda

Commissioner Hester Pierce has spoken out against the SEC’s new crypto regulatory agenda.

passionately pro-crypto A member of the SEC’s five-person Board of Commissioners issued a public Statement on Wednesday cursing the regulatory agency’s new “regulatory flexibility agendaPublished the same day, the agenda consists of 53 legislative documents that outline the short- and long-term regulatory actions that the administrative agency plans to take.

According to the chairman of the SEC Gary Gensler, the agenda is driven by two public policy goals: continuing to drive efficiency in US capital markets and modernizing the rules of today’s economy and technologies. “Doing so will help us achieve our three-part mission: protect investors, maintain fair, orderly and efficient markets, and facilitate capital formation,” Gensler said in an announcement on the agenda. Press release,

Commissioner Pearce, however, disagrees with Chair Gensler’s approach to regulating capital markets, saying in his latest statement that his plan “sets erroneous goals and a flawed way to achieve them.” she wrote:

“The agenda, if enacted, risks shutting down the regulatory version of the rip current – ​​high-speed currents flowing off shore that can be fatal to swimmers. Just as some wave and wind conditions are dangerous As rip currents can create, the speed and character of rule-making on this agenda create dangerous situations in our capital markets.”

Commissioner Pearce then slammed the SEC’s plan, saying it bypassed the issues at the core of the agency’s mission in favor of “shiny objects” outside its jurisdiction. “We once sought to protect retail investors; We now run to the aid of professional investors,” she said, adding that she believes the SEC in its current form does less to help smaller and emerging companies and instead raises their costs and their investors. Shortens the base.

Amid his criticism, Commissioner Pierce also addressed the agency’s timid attempt to regulate cryptocurrency protocols—particularly decentralized cryptocurrency exchanges and liquidity providers—first dealing with the industry’s primary needs and repeated demands for regulatory clarity. Without it.

“While the agenda includes regulations that may regulate crypto protocols or platforms through an unmarked backdoor, it appears to include no rules to deal primarily with the main regulatory questions arising around these assets. No,” she wrote, referring to the SEC’s proposed rule to amend the definition of “exchange” in the Securities Exchange Act of 1934.

The said rule, referred to in a 591 page document Published in January, the crypto fails to make any direct reference to assets or decentralized finance protocols. Instead, it proposed the inclusion of all “communication protocols” and systems that facilitate buyers and sellers of securities within the Exchange Act’s definition of “exchange”.

Several industry experts have argued that the proposed rule represents the SEC’s effort to bring decentralized exchanges and money market protocols within its regulatory framework. More importantly, the overly broad phrasing of the definition redefines all “communication protocols” as risk potential securities exchanges. As a result, several notable crypto industry stakeholders including Coinbase, Delphi Digital, Coin Center, FTX and the Blockchain Association have submitted comments to the agency. opposition to the proposal,

Pierce, the commissioner responsible for the SEC’s token safe harbor proposal, said when the agency hastily writes and enforces a myriad of rules, it creates situations that could shake up markets. “We can avoid creating regulatory rip currents by rearranging our agenda to focus on core issues to protect investors and the operation of our markets, and slow the pace to ensure that we And let the public think about what we are doing,” she said. Abbreviation.

Disclosure: At the time of writing, the author of this article owns ETH and several other cryptocurrencies.

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