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SEC Commissioner Hester Peirce is continuing to express her dissent at what her regulatory agency is doing to crypto under the charge of Chairman Gensler.
A regular dissenter
On several occasions now Commissioner Peirce has felt obliged to publicly voice her dissent at what she sees as her agency’s failures in regards to the cryptocurrency sector.
Peirce is now in her second term as one of the five commissioners for the SEC, a term which is due to expire in 2025. She is generally known to be very much her own person as regards SEC decisions, and has been a sole objector on several votes now.
The crypto sector is one in particular where Peirce finds much fault with the Securities and Exchange Commission. She accuses her own agency of being “hostile to crypto” and of being “lazy and paternalistic”, saying that the agency could not be bothered to update its registration process and actually make it “workable” for those trying to register.
In her latest statement against “amending the definition of exchange”, publicly available on the SEC website, Peirce does not mince her words when she accuses Chair Gensler of causing “stagnation, centralisation, expatriation, and extinction”.
Peirce starts by outlining how 30 years ago, the SEC was faced with the challenge of regulating exchange innovation that was outside of the securities rules of the era. She said:
“faced with a choice between fostering innovation or stifling it with an inflexible and expansive interpretation of the statutory definition of “exchange,” the Commission chose innovation.”
She went on to comment on today’s SEC as not being able to “think creatively” in order to encourage innovation, but that instead, its “regulatory bullheadedness” often caused “absurd consequences”.
“today’s Commission aggressively expands its regulatory reach to solve problems that do not exist. Today’s Commission treats its basic approach to exchange regulation as something that must not—indeed cannot—be altered to allow room for new technologies or for new ways of doing business.”
Today’s Commission tells entrepreneurs trying to do new things in our markets to come in and register. When entrepreneurs find they cannot, the Commission dismisses the possibility of making practical adjustments to our registration framework to help entrepreneurs register, and instead rewards their good faith with an enforcement action. Today’s Commission treats the notice-and-comment rulemaking process not as a conversation, but as a threat.
It might appear that Gary Gensler is using his agency to bring down crypto in its entirety. The way in which he has targeted the big exchanges such as Coinbase, Binance, Kraken, Bittrex (just recently), and others, shows that he is attempting to prevent the public from buying or selling cryptocurrencies.
The three crypto-related banks that ‘failed’, including Signature Bank, which was said to be perfectly solvent before the FDIC took it over, were arguably allowed to fail because they serviced the crypto industry.
Attempts to get at the decentralised finance arm of crypto could also be taken as part of the grand scheme to protect the banking industry from an innovative, cheaper, quicker, and fairer competitor.
That one of the SEC’s own commissioners should be so totally against many of its decisions speaks volumes, and all right-minded Senators, and Congressmen/women would do well to at least investigate the information that commissioner Peirce is trying to highlight.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.