**SEC Commissioner Discusses Regulation and Enforcement of Crypto Market**
In a recent interview, US Securities and Exchange (SEC) Commissioner Hester Peirce addressed the issue of regulating the cryptocurrency market. She responded to calls from industry participants and lawmakers, such as Coinbase and Senator Cynthia Lummis, for a single regulator to oversee the entire market.
However, Peirce, often referred to as ‘Crypto Mom,’ expressed concerns about creating another regulatory body. She pointed out that, typically, when a new regulator is established, it ends up adding to the existing regulatory burden without effectively addressing the issues at hand. Peirce made these comments in an interview with CoinDesk.
Peirce also criticized the lack of clear guidance and progress in terms of concrete regulatory actions from the SEC. She noted that, under the leadership of SEC Chair Gary Gensler, the agency has primarily relied on one-off enforcement actions. Peirce called for a more proactive approach to regulatory clarity rather than solely relying on enforcement measures. She highlighted the divergent approaches to crypto regulation between Gensler and his predecessor, Jay Clayton, suggesting that Gensler wants to establish clear boundaries for the industry.
**SEC Commissioner’s View on NFTs Falling Within Jurisdiction**
During the interview, Peirce also discussed the rising popularity of non-fungible tokens (NFTs) and their potential regulatory implications. She acknowledged that certain aspects of NFTs may fall within the SEC’s jurisdiction. Peirce urged participants in the NFT market to be aware of potential overlaps with securities regulations, particularly in cases involving fractionalized NFTs. She emphasized the need for caution in navigating the regulatory landscape surrounding these assets.
**Delays and Rejections of Bitcoin ETF Applications**
Moving on to the topic of Bitcoin exchange-traded funds (ETFs), Peirce commented on the approval process for spot Bitcoin ETFs. While the market saw the introduction of the first Bitcoin futures ETF under Gensler’s tenure, the approval of a spot Bitcoin ETF remains elusive. Several applications for physically-backed Bitcoin ETFs have been either delayed or rejected by the SEC, citing concerns about market maturity and potential manipulation.
Peirce challenged the SEC’s reasoning behind denying spot Bitcoin ETF applications, considering it outdated. She expressed uncertainty about the likelihood of a spot ETF approval in the coming year, as she did not fully grasp the agency’s rationale.
She mentioned that Gensler has indicated a desire to see platforms registering with the SEC, which could potentially be a prerequisite for approving a spot product.
**Gensler’s Appointment of Senior Adviser Emphasizes Crypto Regulation**
In a significant development, SEC Chair Gary Gensler recently hired Corey Frayer as a senior adviser specializing in cryptocurrency. Frayer, who has a background in International Economics and Finance, previously served as a senior adviser to members of Congress and held a position on the US Senate Committee on Banking, Housing, and Urban Affairs.
This appointment aligns with Gensler’s plan to establish a comprehensive regulatory framework for the crypto industry in 2022. Frayer’s role at the SEC will focus on policymaking and interagency coordination related to the oversight of crypto assets.
**Conclusion**
In conclusion, SEC Commissioner Hester Peirce discussed the challenges and opportunities in regulating the cryptocurrency market. She expressed reservations about creating additional regulatory bodies and called for a more proactive and clear approach to regulation instead of solely relying on enforcement actions.
Peirce also highlighted the potential regulatory implications of NFTs falling under the SEC’s jurisdiction, advising caution in the evolving landscape of fractionalized NFTs.
Additionally, Peirce commented on the delays and rejections of spot Bitcoin ETF applications, questioning the SEC’s reasoning and the possibility of future approvals.
Lastly, SEC Chair Gary Gensler’s appointment of a senior adviser specializing in cryptocurrency further emphasizes his commitment to establishing a comprehensive regulatory framework for the crypto industry.
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