The US cryptocurrency regulatory landscape could undergo a significant shift with the potential nomination of Hester Peirce to lead the Securities and Exchange Commission (SEC).
Known as “Crypto Mom” in the cryptocurrency industry, Peirce is widely considered the ideal candidate to succeed Gary Gensler as head of the federal agency.
The crypto community's attention is focused on Peirce's ability to lead an agency that has been criticized for its regulatory approach under Gensler, who has taken a more aggressive and restrictive stance toward cryptocurrencies.
Recently, Mike Novogratz, CEO of Galaxy Digital, noted that Peirce could take over as SEC chairman and lead the country’s regulatory transformation towards cryptocurrencies and digital assets. According to Novogratz, Peirce’s experience as an SEC commissioner and her pro-crypto stance could drive more favorable regulatory policies for the sector in the United States.
To date, Peirce has been Known as a strong advocate of cryptocurrency innovation, advocating for a more flexible and principles-based approach to regulation. She has also criticized Gensler’s arbitrary regulatory policy, which she says has stifled innovation and hindered the growth of the crypto industry in the United States.
Hester Peirce: A Pillar in Crypto Regulation
Hester Peirce has served as an SEC Commissioner since 2018, after being nominated by former President Donald Trump. Her career includes significant roles as a legal advisor on the Senate Committee on Banking, Housing, and Urban Affairs, as well as an attorney in the SEC’s investment management division. Her nickname “Crypto Mom” comes from her consistent advocacy for a regulatory framework that favors innovation and growth in the crypto sector.
Throughout her delegation as commissioner of the federal agency, Peirce has been outspoken in her criticism of what she sees as the regulator's misguided approach to the cryptocurrency industry., characterized by “enforcement regulation” that has led to a series of legal actions against various crypto platforms.
Peirce has argued that this regulatory approach has not only been ineffective in overseeing the digital asset industry, but has also stifled innovation and development in the sector. In her public interventions, she has emphasized the need to provide regulatory clarity and a more welcoming environment for startups in the cryptocurrency space. She has also argued that this regulatory clarity is indispensable for the United States to lead crypto-asset financial and technological innovation.
In 2021, Peirce proposed the so-called "Safe harbor«, a regulatory project that would allow new cryptocurrency projects to operate without fear of regulatory retaliation for an initial period, thus facilitating their development and growth.
The possible departure of Gary Gensler
Peirce's potential nomination to the SEC follows speculation about Gensler's departure from the regulatory agency, which has increased following Donald Trump's election victory on November 5. While experts note that Trump may not be able to fire Gensler without cause, they also suggest that this could resign from his current position as SEC chairman in the new White House administration.
Markus Thielen, CEO of 10x Research, said in a note that Gensler's stance on cryptocurrency regulation is not in line with Trump's plans to turn the United States into the world's cryptocurrency capital. Because of this, many believe that his permanence in the federal agency could be unsustainable.
Trump has promised to take a more favorable approach to cryptocurrencies and promote a new political environment that transforms the United States into a crypto superpower.
The future of cryptocurrency regulation under Hester Peirce
Former President Trump’s vision for making the United States a global leader in cryptocurrencies stands in stark contrast to Gensler’s current enforcement policies. However, Peirce’s potential appointment as SEC chair could lead to a more crypto-friendly approach, with a greater emphasis on innovation and consumer protection.
Therefore, the Crypto Mom presents herself as a logical choice to lead the transformation that Trump has promised. Their track record shows a commitment to creating policies that not only protect investors, but also encourage innovation and growth within the crypto ecosystem. This could prove crucial in creating a more conducive environment for the growth of the crypto industry and reintegrate the United States into a competitive position vis-à-vis other jurisdictions that have adopted friendlier stances towards cryptocurrencies.
