The SEC Commissioner, Hester M. Peirce, widely known as “Crypto Maman”, published a declaration entitled “There must be a way to get out of here” where she calls for the public’s contribution to help To define the regulatory treatment of cryptographic assets.
His remarks indicate a renewed thrust to clarify the approach of the dry to cryptocurrencies, in particular as to whether certain tokens are considered as titles under federal law.
Hester Peirce de la sec recognizes that the Howey test is problematic for crypto
Peirce’s central concern revolves around the lack of clear classification of cryptographic assets. It has recognized the complexity of the application of the Howey test, the legal standard used to determine if an asset constitutes security.
“Market players have expressed their concern that the Howey test, as the Commission applied, that is a complex analysis that can be difficult to apply in a coherent manner,” said Peirce. His proposal suggests taxonomy with four categories:
- Cryptographic active ingredients that are intrinsically
- Cryptographic assets sold as part of an investment contract but which are not themselves titles
- Tokenized titles, which exist as digital representations of traditional titles
- All the other assets of crypto, which, according to Peirce, are not considered as titles and represent the largest segment of the market
Peirce requests public comments on the question of whether this classification provides regulatory predictability and whether the new disclosure rules should be adapted to cryptography offers.
Peirce’s position strongly contrasts with the approach of the application of the President of the SEC, Gary Gensler. By virtue of peopleler, the SEC continued several proceedings against large cryptographic companies, arguing that most tokens are considered titles. This aggressive application left the leaders of the uncertain industry on how to operate legally in the United States. Peirce’s desire to engage with the cryptographic community made it a rare lawyer within the Commission. In the past, she has criticized the lack of clear advice from the dry, arguing that a strategy focused on the application of the law stifles innovation.
“This document invites comments by asking some of the questions with which the working group is struggling. The working group actively examines solutions to many questions presented. However, your contributions can help this process considerably, “said Peirce.
His remarks come when the main global regulators adopt alternative approaches. The Mica framework of the European Union offers a structured license regime, while jurisdictions such as Hong Kong and water have created specialized rules for cryptographic companies. On the other hand, the United States has relied on the application on a case-by-case basis, leaving the actors of the frustrated industry.
The Peirce initiative asks the cryptographic industry to weigh several critical questions, in particular:
- How should the dry define and classify cryptographic assets?
- Should the commission establish security provisions for blockchain projects?
- How can chip issuers meet the disclosure requirements without using obsolete regulatory frameworks?
- Should stables, NFT and enveloped tokens should fall under the jurisdiction of the dry?
- What rules should govern cryptographic exchanges and the secondary market trade?
One of the longtime proposals of Peirce – a refuge rule for cryptographic projects – is also back on the table. She previously introduced the 195 rule, which would provide a period of thanks to blockchain projects to develop their networks before facing regulations on securities.
Peirce reiterated his conviction that the dry must recognize the decentralized networks of traditional securities issuers differently. “At the end of Safe Harbor’s term, token transactions may not be securities transactions if the network had become a decentralized or functional network,” she said.
The call of Peirce for public comments marks a rare opportunity for the votes of the industry to shape dry policy. Although its position does not necessarily reflect that of the full committee, its desire to challenge the status quo could put pressure on regulators to establish clearer directives.
His declaration also raises political implications. With the 2024 elections bringing new leadership, the Cryptographic Regulation Department in the United States remains uncertain. Some legislators have argued for an action by Congress to clarify the rules of cryptography, but partisan taxation has blocked progress.
For the moment, the PEIRCE initiative reports a moment of dialogue – which could determine the regulatory fate of cryptographic assets in the years to come. It remains to be seen if the dry remains to be seen.
