SEC Commissioner Hester Peirce Opposes Crypto Bailouts

Keys to take

  • SEC Commissioner Hester Peirce commented on the ongoing bear market in an interview published by Forbes.
  • Peirce opposed the idea of ​​bailouts for cryptocurrency projects and hinted that the bear market would eventually be healthy for the industry.
  • He also warned that scammers can take advantage of investors ’desperation to commit fraud during turbulent markets.

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SEC Commissioner Hester Peirce suggested in an interview with Forbes who would oppose bailouts for cryptographic projects, although she remains a friend of space.

Peirce condemns cryptographic bailouts

Following the collapse of TerraUSD and Celsius’ decision to freeze withdrawals, market prices fell sharply. The price of Bitcoin is now $ 20,800, the lowest since December 2020.

Hester Peirce, however, suggested that the ongoing bear market will help build a stronger foundation for the crypto industry. Peirce commented that the present moment is “not only for market participants to learn, but also for regulators to learn.”

Although some companies may seek bailouts, Peirce suggested the bailouts are outside the authority of the Stock and Securities Commission. In addition, he said he does not support bailouts for cryptocurrency companies.

He added that the crypto “does not have a rescue mechanism” and that this absence is “one of the strengths of that market”, which implies that the crypto market has some ability to self-regulate. She concluded: “We really need to let these things unfold.”

Peirce went on to advise investors to be wary of any service that promises high returns. In that case, investors “need to ask questions about their associated risks,” he said.

In addition to the issue of bailouts, Peirce noted that the SEC may receive more advice on fraud in the current conditions. She warned that scammers could take advantage of investors’ despair stemming from the bear market.

Peirce remains pro-cryptocurrency

Peirce has historically advocated for moderate cryptocurrency regulations. He is responsible for the SEC’s Safe Harbor proposal, which would allow new cryptographic projects to be developed rapidly.

In this week’s Forbes interview, Peirce also expressed positive feelings toward the Responsible Financial Innovation Act, a bipartisan bill that would set clear rules for the crypto industry. It was introduced earlier this month by Senators Cynthia Lummis (R-WY) and Kirsten Gillibrand (D-NY).

Peirce also commented in favor of Bitcoin ETFs in a speech last week. The SEC has rejected all spot Bitcoin ETFs to date. In his statement, Peirce urged the regulator to “categorically deny publicly traded cryptocurrency products.”

Commissioner Peirce has been the SEC’s most pro-cryptocurrency regulator since early 2018. She is likely to step down when her term ends in 2025.

Disclosure: At the time of writing, the author of this piece had BTC, ETH, and other cryptocurrencies.

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