SEC Commissioner Hester Peirce Says Crypto Products Are Possible in US Markets
In a new interview with host Peter McCormack, producer of crypto podcast What Bitcoin Did, US Security and Exchange Commissioner Hester Peirce maps out the role of the SEC with respect to Bitcoin and new crypto-related products.
The US regulator, which recently took enforcement action against crypto trading platform EtherDelta and also cracked down on initial coin offerings that allegedly offered unregistered securities, extended the deadline on its latest decision for a fully regulated Bitcoin ETF.
Earlier this year, the SEC rejected several Bitcoin ETF proposals.
Peirce, who issued a dissent in July after the SEC rejected the Bitcoin ETF proposal from Ty and Cameron Winklevoss of cryptocurrency exchange Gemini, noted at that time that the agency’s lack of approval was detrimental to the Bitcoin market.
“In addition, I am concerned that the Commission’s approach undermines investor protection by precluding greater institutionalization of the bitcoin market. More institutional participation would ameliorate many of the Commission’s concerns with the bitcoin market that underlie its disapproval order. More generally, the Commission’s interpretation and application of the statutory standard sends a strong signal that innovation is unwelcome in our markets, a signal that may have effects far beyond the fate of bitcoin ETPs.”
Since that time, the agency has been taking a long and deliberate approach to making its upcoming decision, analyzing public comments as well as meeting with interested parties VanEck, Cboe and SolidX last month.
Speaking with McCormack on November 20, Peirce says she’s concerned that the SEC strays from its mandate of not standing in the way of innovation.
“This country is built on drawing brilliant ideas from all over the world because we have such deep capital markets. People want to come here because they can find the money to support those ideas. And I certainly want the US to continue to be a center of innovation and a center of creative thinking. I do worry that if we send the message that it’s just too hard to get through the regulatory thicket here, people will go to places where they say, ‘We’re going to be much more open to innovation.’”
As for commentary on the possibility of an SEC regulated Bitcoin ETF, Peirce says that timing is difficult to predict and that people need to let the regulatory process play out.
According to Peirce,
“Things are getting more developed. So I can’t say that anything is inevitable, but I can say that given the amount of time and energy being spent in this area, I think it’s definitely possible that we could see products that are based on cryptocurrencies in our markets.”