Whether or not financial innovations like Bitcoin could fit inside the parameters of old-school laws became the central point of Hester Pierce’s recent keynote.
The U.S. Securities and Exchange Commission (SEC) Commissioner, while speaking at the University of Missouri School of Law, recognized that blockchain-based decentralized networks do not fit “neatly” within their securities framework. Therefore, it is important for policymakers and regulators to amend the existing federal laws to include new technological protocols.
“Yet,” Pierce added, “many of these projects begin in a centralized manner that looks about the same as any other start-up. A group of people gets together to build something, and they need to find investors to fund their efforts, so they sell securities, sometimes called tokens. The SEC applies existing securities laws to these securities offerings, which means that they must be conducted per the securities laws or under an exemption.”
I look forward to working with you @SECJackson to open the doors to innovation, but we’re not a merit regulator issuing seals of approval, so let’s encourage investors to do their own work to decide whether an investment is right for them: https://t.co/iMA7NUkLRp
— Hester Peirce (@HesterPeirce) February 7, 2019