SEC member Hester Peirce, known as “Crypto Mom” in cryptocurrency circles, says the new SEC plan threatens the DeFi altcoin sector. According to Hester Peirce, a member of the United States Securities and Exchange Commission (SEC), the SEC’s new proposal has the potential to pose a significant threat to DeFi protocols. Details are on Kriptokoin.com.
DeFi altcoin markets under threat
DeFi provides an infrastructure that makes it possible for people who cannot trust the traditional financial system (bank) to carry out their financial transactions, not by an authority, but through an algorithm created by the system. Uniswap, Avalanche, Chainlink can be shown as popular DeFi altcoins that come to mind first. SEC Commissioner Hester Peirce said the vague language in the commission’s new proposal, aimed at modernizing the definition of the stock market, could pose a threat to decentralized finance. In a statement released Jan. 26, SEC Chairman Gary Gensler claims it’s important to adapt the rules to update to keep up with the “increasingly electronic” systems that trade government securities.
In the decades since Congress enacted the definition of a stock exchange, there have been many changes to platforms – especially as they are becoming more and more electronic.
While the proposal doesn’t mention cryptocurrencies, Peirce warns it could be used to expand surveillance on crypto trading platforms. “The proposal could potentially reach more trading mechanisms, including DeFi protocols,” Pierce says. Gensler has repeatedly stated that DeFi protocols tend to be centralized, urging the entrepreneurs behind these platforms to register with the SEC. He also stated that the vast majority of cryptocurrencies are unregistered securities. In September, the Wall Street Journal reported that the SEC has begun investigating DeFi giant Uniswap. Peirce, who is a lone Republican on the commission following the recent departure of Elad Roisman, has been a staunch crypto advocate for years, complaining about the lack of regulatory clarity in the US.
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