Crypto DeFined: Hester Peirce Recap & the Week Ahead

By Kathy Chu, TruthDAO

Last Friday on “Crypto DeFined,” Hester Peirce, currently the lone Republican commissioner at the Securities and Exchange Commission,  made it clear that she embraces her role as an independent voice in the regulatory world. While Peirce’s views on crypto often diverge from the majority at the SEC, headed by Democrat Gary Gensler, they are largely embraced by the web3 community.

During our discussion, Peirce talked about everything from fraud to innovation in the crypto world. My top five takeaways:

SCAM ARTISTS: The way Peirce sees it, “investor excitement” – in any market -- is a strong draw for scammers. The crypto world “draws in people who are there just to rip you off, to steal your money. That’s what I’ve seen over and over in my career at the SEC,” she said. “They run to the place where the most attention is, because they know if they put whatever the flavor of the day is on the title of their scam, they’ll get more victims.”

CRYPTO AS A CONVENING PLATFORM: Crypto allows people to move value across the internet the same way you move data. Why that matters: “The ability of crypto networks to bring people together, to work and to coordinate their activities in new ways, that’s also a powerful concept,” Peirce said.

CRYPTO REGULATION: Can any one entity regulate the crypto world with efficiency? The short answer: maybe not.

“Crypto is going to be used in a lot of different things we do, whether it’s in the financial world or in other parts of our lives,” Peirce points out. “Trying to create one regulator to deal with crypto may or may not be consistent with the world in which crypto is part of so many things that we do.”

ROOM FOR EXPERIMENTATION: Peirce thinks the crypto world, given its decentralized nature, might require a creative regulatory hand to flourish responsibly: “I’m not terribly pleased with the knee-jerk reaction that we have (one) regulatory framework and we’re going to fit a square peg into a round hole,” the SEC commissioner argues. “What we ought to be doing is building this free room for experimentation, with guardrails of course, and allowing people to try new things.”

QUASHING INNOVATION: Peirce worries that regulators’ one-size-fits-all approach will stifle innovation over time — not just in the freewheeling cryptocurrency world, but in established markets like financial services, as well.

“We have such a precise and prescriptive set of rules that people tend to say, 'You know what? I’m looking at where I can build innovative things and I’m just going to avoid the financial industry altogether. I’m going to go to another industry that’s not as heavily regulated and do my thing there.'”

That insight is drawn, in part, from Peirce’s own observations over the years: “I hear from people all the time that they’re either moving somewhere else to work on their innovation,” or even excluding U.S. citizens from participating in their projects because they’re trying to avoid the hassle of dealing with U.S. regulations.

Adds Peirce: “I wonder how much innovation we have missed out on already?”

Tune in Thursdays for our “Crypto DeFined” broadcast, brought to you on the Fireside platform by TruthDAO. Check our website at for details.

Miss the Hester Peirce show? Watch the entire interview here.