There is growing regulation for blockchain and digital assets across the globe, and as a result, crypto-enterprises are seeking refuge in regions that have lenient regulations.
There has been a lack of clarity in the US on regulations regarding cryptocurrencies. Hester Peirce, a Commissioner at the US Securities Exchange Commission, indicated in an interview that they are working on providing a clear framework for cryptocurrencies.
Crypto business moving to regions with clear regulations
Peirce shared her concerns in the interview regarding businesses moving to other jurisdictions because of unclear SEC regulations. The Commissioner said that it will take the SEC some time to come up with these regulations because of how the agency is currently structured. She added that regulatory certainty will ensure businesses are operating smoothly and will even motivate companies that have moved business elsewhere to consider coming back.
Peirce’s comments come after Circle, which is led by Jeremy Allaire, indicated that it was considering shifting most of its operations to Bermuda because of regulatory uncertainty in the US. The Commissioner said that instead of businesses moving to other regions, they should come to the SEC, which is open to listening to them. She says that businesses should be ready to discuss their business plan with the SEC, which can offer guidance and also provide some much-needed impetus to their business objectives.
SEC’s welcoming approach towards cryptocurrency adoption
The SEC has demonstrated a welcoming approach towards adoption of cryptocurrency, but those businesses planning to undertake fraudulent or unregistered offerings should be cautioned. The Commissioner asserted that there is a need for the provision of clear regulations and guidance so that businesses can be aware of what they are supposed to comply with. It is through clear regulations that blockchain and digital assets enterprises can be held accountable for noncompliance.
While acknowledging that the SEC has lost a lot of time in establishing clear cryptocurrency regulations, the Commissioner indicated that they are currently working on setting a level playing field in the industry. This will ensure that the implementation of crypto regulations does not pose a challenge of any form to business operations in the industry.
A lack of clear regulations should not derail innovations
Pierce said that the lack of clear regulation should not derail innovation in the industry because the SEC is not responsible for guiding innovations. She said that as a commission, they cannot stop it, but all they can do is embrace the positive potential that innovation offered. She concluded by indicating that a lack of clear regulations and guidance in the industry is likely to push businesses to other jurisdictions that already have guidelines governing cryptocurrency. Therefore there is a need for the SEC to provide a legal framework that offers guidance in the blockchain segment.