Hester Peirce: BitMEX Arrests Are a Clear Message From Regulators

Share Article
In Brief
  • SEC commissioner Hester Peirce weighed in on the BitMEX case during an episode of the Unconfirmed Podcast.

  • According to Peirce, enforcement actions against BitMEX are a clear signal that regulators are paying more attention.

  • Peirce is also attempting to get a proposal approved for regulatory "safe harbors" that would buy token issuers some time.

  • promo

    Gravity Dex Protocol: Bringing DeFi to Cosmos

The Trust Project is an international consortium of news organizations building standards of transparency.

On October 13, SEC commissioner Hester Peirce aka crypto mom appeared on the Unconfirmed Podcast with Laura Shin.

Sponsored



Sponsored

In the interview, Shin and Peirce covered a lot of ground, including her take on the recent charges and arrests related to crypto derivatives exchange BitMEX. 

To recap, on October 1, the U.S. Commodity Futures Trading Commission (CFCT) took regulatory action against BitMEX. The U.S. Department of Justice also pressed criminal charges against its owners for allegedly running lax anti-money laundering (AML) and know your customer (KYC) protocols.

Sponsored



Sponsored

Much of BitMEX’s senior leadership team stepped down in the wake of these enforcement actions, while the exchange’s parent company vowed to fight charges.   

According to Peirce, the case is another example of the U.S. government sending a clear message: the crypto industry is under increased scrutiny from regulators and law enforcement. 

Although the SEC was directly not involved in the BitMEX case, it has turned down several applications for Bitcoin exchange-traded funds.

The SEC has also targeted some crypto companies for allegedly selling unregistered securities via initial coin offerings (ICOs). Celebrity influencers who promoted ICOs have also been in the regulator’s crosshairs. 

Industry Implications

When queried on the potential effect of the case on the crypto industry and future Bitcoin ETF applications, Peirce stated,

“I think the message has been coming to the industry fairly loud and clear on the AML/KYC front, and I’m sure it will continue. It’s a difficult area for traditional financial firms as well. Lots of firms run into trouble there, but it’s definitely sending a message to the crypto world.”

Pierce also alluded to the reason for the enforcement action,

“when there are U.S. users of a product or service, there’s going to be enforcement of U.S. laws, and that’s what we’re probably seeing here.”

Creating Safe Harbors 

In addition, the interview touched on Peirce’s continued advocacy for a proposal launched in February that would create so-called token “safe harbors.” If adopted, this proposal could provide cryptocurrency companies running ICOs a three-year grace period before the SEC took action against them. 

Although she remains hopeful for “version 2.0,” Pierce said that at present, she has not been able to convince her colleagues to support the safe harbor proposal. 

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
Sponsored
Share Article

Colin is a writer, researcher, and content marketer with a keen interest in the future of money. His writing has been featured in numerous cryptocurrency publications, and his holdings don't amount to more than a handful of BAT.

Follow Author

Crypto predictions with the Best Telegram Signal with +70% accuracy!

Join now

Market signals, studies and analysis! Join our Telegram Today!

Go

Market signals, studies and analysis! Join our Telegram Today!

Go