Commissioner Hester Peirce says self-regulation can be effective in fostering investor protection
SEC Chair Gary Gensler is seeking tougher regulations for crypto exchanges
US Securities and Exchange Commission (SEC) commissioner Hester Peirce has cautioned against attempts to impose strict regulations on cryptocurrencies, the Financial Times has reported.
“I am concerned that the initial reaction of a regulator is always to say ‘I want to grab hold of this and make it like the markets I already regulate‘,” Peirce told the publication in an interview.
According to the senior SEC figure, imposing strict regulations to align the crypto sector with other markets risked discouraging investors. Her comments follow recent efforts spearheaded by SEC Chair Gary Gensler targeting to put cryptocurrency under the same regulatory umbrella as other financial assets.
According to Gensler, there’s a need to update the rules governing cryptocurrency investing in the US as “gaps” exist He wants to see laws in place clarifying who between the Comptroller of the Currency (OCC), the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) should regulate cryptocurrency exchanges.
Gensler also seeks to have crypto investors access the same protections investors on the New York Stock Exchange or Nasdaq.
But Peirce thinks these efforts raise some concerns.
“I am concerned about trying to make it harder for people to do truly peer-to-peer transactions. . . I think regulation doesn’t all have to happen at government-level. You can have pretty effective self-regulation.”
The commissioner also warns against stricter policies targeting retail stock trading platforms like Robinhood. The online platform has attracted greater scrutiny as retail traders swamped it to skyrocket the stock price of GameStop.
US officials have expressed concern about the heavy trading seen on platforms like Robinhood, with major features faulted being the use of gamified competitions and reward systems, among others.
Peirce sees nothing wrong with features that encourage further adoption and investment, noting that using gamification to make a “financial platform more user-friendly is not a bad thing.”
According to her, the SEC would do more in educating the masses on the dangers of trading if it gamified its communication with investors. This, she told the FT, would see the SEC meet retail investors “where they are.”
While Hester Peirce is one of the most outspoken SEC voices favouring a balanced approach to crypto regulation, her comments suggest there’s yet to be a unanimous approach to the regulation of the $1.5 trillion crypto market.
For more news at Break’n News – click here
Break’n Pics – Click here for Free Stock Photos
GoCoin – Latest Cryptocurrency News and Trading