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Peirce Laments, SEC ‘Squandered A Decade’

Regulation | Jan 15, 2024

Commissioner Hester M. Peirce - Peirce Laments, SEC 'Squandered A Decade'

Commissioner Hester M. Peirce

Commissioner Peirce's Critique of the SEC's Long Road to Bitcoin ETF Approval

The U.S. Securities and Exchange Commission (SEC) has finally approved the trading of spot Bitcoin exchange-traded funds (ETFs), marking the end of a decade-long saga filled with regulatory hesitance and missed opportunities.

Commissioner Hester Peirce, often referred to as "Crypto Mom" for her advocacy of cryptocurrency, has been vocal in her criticism of the SEC's prolonged resistance to Bitcoin ETFs. In her statement titled "Out, Damned Spot! Out, I Say!" (a Shakespearean Quote by Lady MacBeth indicating 'metaphorically indicating the guilt she feels for her part in his murder), Peirce expressed frustration over the SEC's inconsistent treatment of Bitcoin-related ETP applications compared to other ETPs. She emphasized that "ETPs are an important innovation" allowing investors to gain exposure to various assets, including cryptocurrencies, in a convenient vehicle.

Peirce pointed out the perplexing nature of the SEC's long string of denials, noting that "predicting approval timelines for spot Bitcoin ETPs was impossible" due to the shifting goalposts set by the Commission.

See:  SEC Greenlights Bitcoin ETFs. Is Ethereum Next?

She criticized the SEC for driving retail investors to less efficient means of attaining Bitcoin exposure and for squandering a decade of opportunities by not applying the standard used for other commodity-based ETPs.

Peirce's Persistent Advocacy and the Impact of the SECs Delay

Commissioner Peirce has been a consistent advocate for a more open approach to cryptocurrency regulation. Her recent statements reflect a long-standing concern that the SEC's hesitance has not only stifled innovation but also potentially harmed investors by limiting their access to Bitcoin through more regulated and potentially safer channels.

The decade-long delay in approving Bitcoin ETFs, according to Peirce, has had several consequences:

  • The arbitrary treatment of Bitcoin ETF applications may continue to harm the SEC's reputation beyond the crypto space, potentially affecting its ability to regulate markets effectively.
  • Peirce criticized the SEC for diverting significant resources to block these applications, which could have been used for other critical regulatory work.

See:  Hester Peirce Reaffirms That the SEC’s Current Approach to Crypto Is ‘Not a Good Way of Regulating’

  • The actions over the past decade have muddled public understanding of the SEC's role, with the Commission appearing to overstep its mandate by withholding investments it disfavored.
  • The SEC's approach has created unnecessary hype and speculation around Bitcoin ETFs, which could have been avoided with a more straightforward approval process.
  • The SEC's stance has potentially alienated a generation of product innovators, signaling that regulatory prejudice can lead to unreasonable delays in product launches.


Commissioner Peirce emphasizes the importance of American investors' right to express their views on Bitcoin through buying and selling spot Bitcoin ETPs. She also commends the perseverance of market participants who have been persistent in the face of the Commission's obstruction.  Her critique of the SEC's hesitance aligns with the growing mainstream acceptance of cryptocurrencies but also paves the way for future crypto-related products.

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