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Hester Peirce recently tackled the US and its lax efforts at crypto regulation and has asked the Congress to properly define the SEC’s role.
The Securities and Exchange Commission’s (SEC) Hester Peirce says that the US might be mishandling crypto regulation. According to the SEC commissioner, the United States has “dropped the regulatory ball”. Peirce believes that not fervently pursuing proper crypto regulation has allowed a lot of fraud in the sector. Speaking at the DC Blockchain Summit, she said:
“We’re not allowing innovation to develop and experimentation to happen in a healthy way, and there are long-term consequences of that failure.”
On what could be done to improve the perceived slack, Peirce offered:
“We can go after fraud and we can play a more positive role on the innovation side, but we have to get to it, we’ve got to get working.”
She capped off by admitting that as hasn’t “seen us willing to do that work so far.”
Peirce’s crypto comments come amid an ongoing crypto slump that has wiped off a sizable chunk of its market value. This slump has been partly triggered by sustained investor sell-offs over rising inflation in the US and underperforming tech stocks. Furthermore, most recently, the stablecoin-induced Luna crash has also been a precipitating factor.
US Crypto Regulation Outlook
According to Peirce, the US Congress should step in. She believes that the Congress should equip the SEC with a more defined and authoritative role to effectively oversee the crypto industry.
“It would be helpful if Congress came in and said, ‘SEC, here’s the role we think you should be playing. CFTC, here’s the role for you,’” she says.
The SEC Commissioner says that the securities regulatory agencies are currently acting undefined roles, which is creating a loose and ineffective ecosystem. She however suggested that a properly-defined regulatory structure for crypto is inevitable as traditional financial institutions are venturing into crypto. Pierce specifies that these institutions need regulatory clarity from the SEC to properly offer cryptocurrency services.
The senatorial duo of Cynthia Lummis (R) and Kirsten Gillibrand (D) are already on top of the ‘clarity bill’. According to both US senators, this bill will provide a comprehensive framework for crypto regulation. It will also contain well-defined, specialized oversight roles for each of the leading regulatory bodies, including the SEC and the Commodity Futures Trading Commission (CFTC). Furthermore, Senator Lummis explains that the clarity bill promotes fluidity in crypto regulation while also nurturing innovation in the space.
Cryptocurrency Regulation in Panama
While the US continues to treat its crypto regulatory situation with some levity, some other nations have a more certain outcome. For instance, Panamanian president Laurentino Cortizo recently refused to endorse a crypto regulation bill until the document tightens its anti-laundering laws. This development came after the country’s National Assembly greenlit a bill facilitating crypto-use regulation last month. The bill covered crypto exchange licensing in Panama, among other things.