U.S. SEC’s “Crypto Mom” Asks For 3-Year Safe Harbor Period for Crypto Businesses
According to a Bloomberg report published on February 6, 2020, the U.S. Securities and Exchange Commission’s (SEC) most noticeable cryptocurrency advocate, Hester Peirce, has floated a plan to allow crypto startups to sell digital tokens without regulatory oversight.
“Crypto Mom” Advocates Minimal Regulatory Oversight
Famous within the cryptocurrency space for her pro-crypto stance, U.S. SEC’s “Crypto Mom,” Hester Peirce, has once again made quite a buzz within the industry. Per sources close to the matter, the Republican commissioner has introduced a proposal that seeks to establish a conducive regulatory environment that would let digital tokens trade for three years before most securities rules come into effect.
Under the proposal, exchanges and brokers would get broad exemptions from regulations that generally underpin trading in stocks and other financial instruments and securities.
That said, it’s also worth noting that Peirce’s ambitious pro-crypto plan is unlikely to generate enough attention under the regulatory body’s current leadership. The U.S. SEC is currently headed by Jay Clayton, who has, on multiple occasions, shown skepticism toward digital currencies. Clayton has been a continual hiccup between the cryptocurrency industry and its dream of a regulated Bitcoin (BTC) exchange-traded fund (ETF).
Clayton has repeatedly emphasized the significance of strong regulatory oversight for cryptocurrency businesses that have often been accused of selling unregistered securities via initial coin offerings (ICO), or private orders.
Traditional Regulations Stunting Crypto Industry Maturity
In remarks prepared for a speech scheduled for February 6 at the International Blockchain Conference, Chicago, Peirce stated that applying traditional SEC regulations to the rapidly budding crypto industry has made it an extremely difficult task for the industry’s well-meaning entrepreneurs to get their projects off the ground.
To fix this menace, Peirce has proposed to implement minimal regulations over crypto businesses. The “Crypto Mom” wants the SEC to limit its jurisdiction over new coin offerings to basic anti-fraud rules and disclosure requirements.
“Our securities laws stand in the way of innovation for digital assets. The fear of running afoul of the securities laws is real. Given the SEC’s enforcement activity in this area, these fears are not unfounded.”
Peirce believes that her proposal for a three-year grace period for crypto businesses will give them enough time to make their operations financially viable without getting suffocated to premature demise under stringent regulations.
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