The SEC’s constant refusal to provide clear regulations for the crypto space has resulted in several risks.
In recent years, the Securities and Exchange Commission (SEC) has come under major backlash from cryptocurrency community members for its inability to provide clearer regulation for the industry.
The SEC’s lack of regulatory clarity has stirred up major issues in the cryptocurrency sector, with several crypto-related firms, including Ripple, charged with conducting an unregistered securities offering.
According to a recent publication by the Securities and Exchange Commission, the agency noted that due to the legal, technological, and regulatory risks associated with safeguarding crypto assets, affected companies are expected to record an asset and a corresponding liability on their balance sheets at fair value.
Commenting on the SEC’s publication, Hester Pierce, a commissioner of the agency popularly referred to as Crypto Mom, expressed her concern with the way the proposal is being made.
Peirce, who believes the accounting determination for crypto companies is appropriate, noted that the risks cryptocurrencies pose, as mentioned in the SEC bulletin, are not new.
However, she faulted the SEC for its constant refusal to provide regulatory clarity for the cryptocurrency industry despite several calls and pleas.
“The Commission has refused, despite many pleas over many years, to provide regulatory guidance about how our rules apply to crypto-assets, so some of the responsibility for the lack of legal and regulatory clarity lies at our doorstep,” Peirce noted in her response.
Crypto mom’s recent comments corroborate what other industry experts have noted that several legal issues the crypto industry has had with the SEC could have been avoided if the agency had provided clear regulations.
Peirce’s comments have earned lots of applause within the crypto community, especially from Ripple’s General Counsel Stuart Alderoty, who quoted her remark on Twitter and added a “fire” emoji, signifying burn or heat.
“The Commission has refused, despite many pleas over many years, to provide regulatory guidance about how our rules apply to crypto-assets, so some of the responsibility for the lack of legal and regulatory clarity lies at our doorstep.” 🔥 https://t.co/gB6vEJnjyA
— Stuart Alderoty (@s_alderoty) April 1, 2022
It is no longer news that Ripple has been involved in a landmark lawsuit with the SEC and the case has lasted for more than a year.
The case is fast approaching a summary judgment on Fair Notice, where Ripple plans to argue that it did not get a prior warning from the SEC that its cryptocurrency offering could breach its laws.