Cryptocurrency laws in the United States should adopt a “reserved” approach and avoid regulating the technology solely from a financial perspective, according to a commissioner at the U.S. Securities and Exchange Commission (SEC).
Commissioner Hester Peirce, often referred to as “Crypto Mom,” shared her views during her remote appearance at Australian Blockchain Week on June 29.
Peirce emphasized the need for regulatory frameworks to acknowledge that cryptocurrencies have applications beyond the financial realm.
While crypto is often associated with financial assets, Peirce highlighted its potential in facilitating decentralized interactions, such as in social media platforms.
She argued that any legal framework should be flexible enough to accommodate the evolving uses of crypto and blockchain technology, while still providing clarity that enables experimentation.
Taking a subtle jab at the SEC’s current approach, which has received criticism from various quarters, Peirce cautioned against delayed enforcement actions resulting from an inflexible regulatory framework. She suggested that regulations should strike a balance between being reserved and offering sufficient clarity, allowing individuals and businesses to explore new possibilities in the crypto space.
When asked about her advocacy for cryptocurrencies, Peirce expressed her belief that the SEC can improve its approach.
She emphasized the importance of being able to speak openly and questioned the purpose of her position if she is unable to do so.
Peirce viewed cryptocurrencies as an opportunity for the SEC to reevaluate its approach to innovation, asserting that the current regulatory stance is inadequate.
Referring to the recent collapse of FTX and subsequent allegations of misconduct, Peirce encouraged the crypto industry to embrace self-regulation.
She stressed the significance of addressing counterparty risks, conflicts of interest, and leverage.
While acknowledging that these steps should ideally be taken without government intervention, Peirce also recognized the potential role of government regulators in this process.
In summary, Commissioner Hester Peirce called for a reserved approach to cryptocurrency regulation in the United States.
She emphasized the need to recognize the broader applications of crypto beyond finance and cautioned against rigid regulatory frameworks. Peirce advocated for a regulatory environment that encourages innovation while still providing clarity.
Furthermore, she encouraged the crypto industry to undertake self-regulation and pay attention to risk factors, suggesting that government regulators could play a supportive role in this endeavor.
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