Commissioner Hester Peirce Lays Out SEC’s Crypto Regulatory Directions Amid Pending Lawsuits

The U.S. Securities and Exchange Commission (SEC) is reassessing its approach to cryptocurrency regulation, moving away from enforcement-driven policymaking, according to Commissioner Hester Peirce.

Key Takeaways: – SEC Commissioner Hester Peirce stated that the SEC is moving away from enforcement-driven policymaking and focusing on clearer regulatory tools. – Peirce’s stance on crypto oversight contrasts with former SEC Chair Gary Gensler’s strict enforcement approach.

Speaking in a Bloomberg Crypto interview on Tuesday, SEC Commissioner Hester Peirce criticized the agency’s previous reliance on lawsuits to shape policy, calling it an unusual approach.

“We’re trying to get back to a path where we’re really using our other tools to make policy,” she said.

Her comments come as the SEC filed a request to pause its legal battle against Binance, the world’s largest cryptocurrency exchange. The regulator sued Binance and its co-founder, Changpeng Zhao, in 2023, alleging securities violations, misuse of customer funds, and misleading regulators.

Peirce did not confirm whether the SEC might withdraw its lawsuits against Binance or other crypto firms. She emphasized that each case would be assessed individually.

The SEC’s evolving stance aligns with a broader shift in crypto policy under former President Donald Trump, who has shown increasing support for the industry. During his presidency, he signed an executive order establishing a crypto advisory group. He reportedly considered creating a national crypto stockpile, a move that could boost asset prices and lend legitimacy to the sector.

Peirce, who was recently appointed to lead the SEC’s crypto task force, is prioritizing the classification of digital tokens to determine which should be considered securities.

Her stance on excluding meme coins from SEC oversight contradicts the position of former SEC Chair Gary Gensler, who asserted that most cryptocurrencies should be classified as securities.

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