SEC Commissioner Peirce Says Election Will Impact the Future of Crypto

SEC Commissioner Hester M. Peirce shared her perspective on how the upcoming election might influence legislative and regulatory frameworks for crypto.

In an interview with Tech Talk at DL News, Commissioner Peirce highlighted the outsized role the SEC Chair has in setting the regulatory agenda, setting the budget and managing the staff. She said that the work conducted by the SEC in relation to crypto assets "depends a great deal" on the Chair and "it really does matter" who that individual is. As a result, she suggested, whoever is elected President will appoint the next Chair, which will have a great deal of impact on the regulatory approach to crypto.

She said that the composition of Congress will affect the legislative approach to crypto. She said she was happy to see Congress debating the complicated subject of allocating authority between the SEC and the CFTC. She underscored the difficulty of the legislative effort, given that there are many aspects to crypto that do not affect the financial markets at all (e.g., decentralized physical infrastructure). She also recognized that the agency's jurisdictions are "bumping up against each other" but emphasized that she does not view the two as rivals and said they can work together. More generally, she described the SEC's willingness to comply with the role that Congress "wants [them] to play, whether it is a more limited or expansive role." She stressed the importance of "accomodat[ing] whatever crypto becomes."

In response to a question about being called "crypto mom" by the media, Commissioner Peirce said: "I am not your mom" explaining that "giving people freedom is a recognition of their dignity as human beings... too often we as regulators, say I'm your mom, I'm going to tell you what to do in your life." She said, "people are all about freedom until something goes wrong" and then they ask "SEC ... why didn't you prevent me from getting hurt ... [but] you can't have it both ways. ... You can have a regulator that has an anti-fraud role, but that doesn't mean a regulator [should] tell you what products are good for you or not good for you."

Commissioner Peirce also criticized the SEC's "approach of using enforcement as [the] leading foot in crypto regulatory policy," which she called a "mistake." She said that it is "more efficient" to concentrate enforcement resources on the "many bad actors in the crypto space."