SEC Commissioner Peirce says rules must be gradual, though crypto guidelines may very well be quicker
The U.S. government is slower than the private sector when it comes to innovation, but that's not necessarily a bad thing, said Hester Peirce, a member of the Securities and Exchange Commission (SEC).
The second-term commissioner spoke to financial advisor Steve Sanduski at CoinDesk's Bitcoin for Advisors event on Monday about how the securities regulator is handling innovations in financial technology, including cryptocurrencies.
"Regulators are slow and there is a reason we are slow. We need to (a) have a process in place so that we make sure that when people change rules, they notice that we are thinking about changing a rule and they comment she said.
Ideally, regulations and guidelines would not limit what technologies can be used, allowing innovators to build a wide range of compatible tools and platforms.
That being said, Peirce noted that certain regulations are very out of date and said she would like the agency to move faster in certain areas, citing cryptocurrencies as an example.
"There are circumstances where we at the SEC have a frame that was built in the 1930s and 1940s and expanded over time," she said. "Surely now that we're seeing what's going on in the crypto room, there are areas where we need to make adjustments and I think we should move faster … I'm impatient there."
Enabling token offerings to operate in a regulatory safe haven like the one proposed by Peirce and providing retail access to Bitcoin through regulated products like an exchange traded fund (ETF) are two areas the SEC is in Could move faster, she said.
When asked how much influence the SEC's five commissioners have on such decisions, she noted that the agency's staff typically approve or disapprove of products like ETFs. The commissioners themselves don't usually get involved, but "in the case of Bitcoin (ETFs) we could weigh up," she said.
Other areas, like approving broker-dealers to provide digital asset services in the US, are more complicated because these companies are overseen by multiple regulators.
When asked about the SEC's future direction, Peirce said, given the forecast that former Vice President Joe Biden will be the next President of the United States, regulators are likely to continue working on crypto.
"I think these things are interrelated in the sense that the president is certainly the one who will appoint the chairman. But even within, you've seen some really great steps being taken by a regulator like the Office of the Currency Auditor, where the OCC sat down and said, "Hey, we're not really great at innovating." Build an office for innovation, "she said.
She also pointed to the fact that there are Congressmen on both sides of the political corridor who are bullish about crypto and said support for the sector is non-partisan.