One of the SEC’s most influential commissioners, Hester Peirce, is a cryptocurrency zealot and is the next in line for redundant cryptocurrency regulation, despite some physiological flaws by the market’s worst companies. the season will not occur.
As an early estimator, U.S. Commissioner Hester Peirce said the Securities and Exchange Commission is utterly optimistic that cryptocurrencies could take off and expand in the next few years, but the recent FTX scandal has We hope the regulators don’t rush into legislation in the wake of user losses due to fraud. buffer.
Perth was unaware that former FTX CEO Sam Bankman-Fried had been arrested in the Bahamas on a U.S. warrant and that the Securities and Exchange Commission had not indicted him for alleged fraud by the company at the time of his comment. , believes that these ugly chapters of financial history must inevitably go through for the world of digital currencies to move forward.
Sam Bankman-Fried was charged by the US Department of Justice on Monday night with conspiracy, wire fraud, and money laundering. In addition, the CFTC intends to sue for violating the Commodities Act.
The state commissioner claims that rather than developing its potential, the cryptocurrency industry remains too firmly rooted in trade.
For Peirce, this asset feels isolated from a robust and exclusive financial world, giving it the impression of being a standalone entity:
The significance of cryptocurrency regulation in the face of total uncertainty
Despite Peirce’s support for cryptocurrency, Gary Gensler, head of the SEC, has long kept a close eye on this asset and been ready to control it, even during the dreaded rush to regulate it.
According to Gensler, the majority of digital currencies must be registered with the Securities and Exchange Commission because they should be seen as securities. Even more, the president compared the cryptocurrency industry to the Wild West.
The difference between the two SEC officials is also felt by the judiciary, which is equally split between libertarians and right-wingers:
“I’m more in favour of individuals having the freedom to try new things and learn from them, and I believe the crypto sector has seen a lot of intriguing experimentation, and I expect there will be a lot more in the coming years.”
The SEC commissioner said.
Obama nominated Peirce for the job in 2016, but the US Senate did not appoint her as an SEC commissioner until 2017.
The position will expire in 2025 and was only officially filled by a state official in 2018. Peirce herself has expressed frustration over the fact that during this time, the bitcoin industry has not developed as she had intended.
The commissioner claims to have been studying Bitcoin since 2012, at which point she claimed she fell in love with the industry. She now intends to do everything in her power to introduce the SEC to this asset and, if at all possible, persuade it to adopt a more open stance toward new, innovative financial products in general.
“I want to keep the door open to innovation so that the financial sector is not dominated by a few big companies and excludes all others.
Hester Peirce’s The collapse of FTX is just the latest black swan that the crypto world has encountered, but by no means is it the entire crypto world.
Another Sam Bankman-Fried funded company, Alameda Research, has billions of illiquid FTT (FTX tokens) on its books and that was the heart of the matter.
Binance CEO Changpeng Zhao said hedging FTX When it announced that it was not that powerful, users sparked a series of massive withdrawals, and the company shut down operations for days after. FTX filed for bankruptcy and was doomed to enter Chapter 11, but that doesn’t stop the industry from developing.
“When I speak to people, I remind people of the following:
Encryption is not about centralized entities. 2:
This cryptocurrency is not about trading. A lot of emphasis has been placed on trading in recent years, but this is not the heart of cryptocurrency. And if it is the core, it is probably not living up to its potential. and three:
It’s still early, so we can still see the future. “
The hope on the SEC Commissioner’s part is that we don’t see any legislation that unduly restricts the cryptocurrency world, as happened after the 2008 global financial crisis.
After the 2007-2008 liquidity crisis, the Dodd-Frank Wall Street Reform and Consumer Protection Act was enacted, leading to the passage of the Consumer Financial Protection Bureau, establishment of the Financial Stability Oversight Council, and the enactment of the Volcker Rule. I was. Filter investments that you consider risky.
“I believe that since doing so is very appealing to regulators and excludes everyone else from the process, we should all be on the lookout for regulatory frameworks constructed in the context of enforcement action. I strongly advise everyone to call a lawyer if they have any questions concerning securities regulations, even if they are completely clear.