SEC’s Hester Pierce Says The US Is Behind On Crypto Regulation• May 26, 2022 12:07 pm • Comments
SEC Commissioner Hester Pierce has publicly stated now that the US has dropped the ball when it comes to regulation when compared to other regions in the world.
One of the major issues that is now plaguing the industry is that the regulation environment is now allowing innovation to take place in a healthy way.
As a result, there is a risk that this could prevent the US from being a leading crypto hub in the future as many within the crypto community are still frustrated with the lack of clear regulations and guidelines.
The uncertainty here has allowed the open interpretation by the SEC and other government entities which has lead to crypto firms not being treated fairly.
SEC's Hester Pierce claims US failed at regulating #cryptohttps://t.co/4mxx8nrZkB
(via @shawdagorj17) @HesterPeirce #Regulation
— CryptoSlate (@CryptoSlate) May 26, 2022
She continued, “We’re not allowing innovation to develop and experimentation to happen in a healthy way, and there are long-term consequences of that failure.”
The comments come as the crypto market meltdown continues.
A broad sell-off in digital assets has erased more than half a trillion dollars from the entire market in the space of a few weeks thanks, in part, to turmoil in a subset of cryptocurrencies dubbed stable coins.
But the collapse of UST — one of the more popular U.S. dollar-pegged stable coins — had a contagion effect across the entire cryptocurrency ecosystem. Those shock waves have also lit a fire under lawmakers and regulators.
As of right now, there is also still a blurry line between the roles of the SEC and the CFTC when it comes to regulating the crypto industry.
In a recent testimony before the House Appropriations Committee, SEC Char Gary Gensler claimed that the vast majority of crypto tokens are considered securities and thus the SEC has jurisdiction over them.
Coincidentally, Gensler has also conceded that perhaps Bitcoin & Ethereum did not fall under the agency’s review but did not provide clear reasons as to why given that they fall under the same criteria as many other digital assets like XRP.
The SEC continues to step up its crypto enforcement division which faced opposition from Hester Pierce who stated that the SEC should not be an enforcement agency.
SEC commissioner Hester Pierce aka “Crypto Mom” says we’ve dropped the ball on regulation…https://t.co/7uKek0fYCv
— BIG CHAMP (@BIGCHAMPTHEBOSS) May 25, 2022
The SEC Commissioner says that the securities regulatory agencies are currently acting undefined roles, which is creating a loose and ineffective ecosystem.
She however suggested that a properly-defined regulatory structure for crypto is inevitable as traditional financial institutions are venturing into crypto. Pierce specifies that these institutions need regulatory clarity from the SEC to properly offer cryptocurrency services.
The senatorial duo of Cynthia Lummis (R) and Kirsten Gillibrand (D) are already on top of the ‘clarity bill’. According to both US senators, this bill will provide a comprehensive framework for crypto regulation.
It will also contain well-defined, specialized oversight roles for each of the leading regulatory bodies, including the SEC and the Commodity Futures Trading Commission (CFTC). Furthermore, Senator Lummis explains that the clarity bill promotes fluidity in crypto regulation while also nurturing innovation in the space.
Meanwhile, crypto regulation in other regions of the world continues to make progress indicating positive growth for investors regardless of what happens.
We now have Jay Clayton, Bill Hinman and Hester Pierce all saying the THE RULES ARE NOT CLEAR.
Ripple WILL WIN the fair notice defense.
And guess what?
If the rules around crypto are not clear, and securities laws are clear, then it sounds like XRP is not a security. #XRP https://t.co/OjJMzapldY
— mickle.xrp♦️ (@MarketsMickle) May 21, 2022
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