Amongst his first acts following his appointment as Acting Chair of the Securities and Exchange Commission (SEC), Mark Uyeda created a Crypto Task Force to be led by Commissioner Hester Peirce, also known as ‘Crypto Mom’.
He called this the ‘SEC Crypto 2.0’ approach. For the last few years, both Commissioners Uyeda and Peirce have bemoaned the strategy of regulation by enforcement under Chair Gensler.
The statement announcing the task force says, “Clarity regarding who must register, and practical solutions for those seeking to register, have been elusive. The result has been confusion about what is legal, which creates an environment hostile to innovation and conducive to fraud. The SEC can do better.”
Mr Uyeda also wants to see far more engagement, not just with the public and crypto firms but also with Congress and other regulators, especially the Commodity Futures Trading Commission (CFTC).
“This undertaking will take time, patience, and much hard work. It will succeed only if the Task Force has input from a wide range of investors, industry participants, academics, and other interested parties. We look forward to working hand-in-hand with the public to foster a regulatory environment that protects investors, facilitates capital formation, fosters market integrity, and supports innovation,” said Commissioner Peirce.
She has previously promoted the idea of a safe harbor approach for tokens related to planned decentralized networks. This would allow three years without classifying the token as a security, after which time an assessment would be required about how decentralized the network has become. Factors considered for decentralization would include voting power, development, and network participation. Once decentralized, the initial development team could no longer control material information that is not publicly available. Commissioner Peirce first proposed this in 2019 during Trump’s first term and updated it in 2021.
Mr Uyeda also previously stated that the SEC should drop its staff accounting bulletin (SAB) 121, which restricts banks from providing crypto custody. It’s still only his first few days as acting Chair.
