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Hester Peirce: Main Insights and Perspectives
Hester Peirce is a member of the SEC’s Board of Commissioners. In her work, she relies on the rejection of rigid and inconsistent steps in regulation, focusing on financial regulatory reform through legislation aimed at improving oversight and regulation following the 2008 financial crisis.
Peirce is a strong supporter of the crypto industry and sees digital assets as a powerful tool for innovation. She emphasizes the role of financial institutions in the evolving landscape of crypto regulation, advocating for cooperation among regulators to facilitate innovation within traditional financial frameworks.
Education and early years at Yale Law School
In 1993, Hester Peirce earned a bachelor’s degree in economics from Case Western Reserve University (Cleveland, Ohio). Five years later, a Juris Doctor degree from Yale Law School.
Peirce’s career path began with the U.S. Court of Federal Claims and a private law firm. She joined the Investment Management Division of the U.S. Securities and Exchange Commission (SEC) in 2000 as a staff attorney and four years later became counsel to Commissioner Paul Atkins.
From 2008 to 2011, Peirce served on the U.S. Senate Committee on Banking, Housing, and Urban Affairs. There, she advised members of the committee on securities issues and worked on financial sector reform in the wake of the crisis of 2008, including oversight and enforcement of new regulations connected to urban affairs.
Peirce spent the period from 2012 to 2017 as a senior research fellow at the Mercatus Center at George Mason University. She emphasized financial markets and regulation.
Securities and Exchange Commission career
In 2015, then-incumbent U.S. President Barack Obama nominated SEC Commissioner Hester Peirce to the Board of Commissioners of the SEC to fill a vacant seat intended for a Republican representative. However, the initiative was not supported by Democrats, and in the end the full Senate never held a vote.
The second time was more successful - in 2017, at the suggestion of then-President Donald Trump, Peirce won a seat on the SEC board. She was sworn in on January 11, 2018, and her term was later extended through 2025.
SEC Commissioner Hester Peirce has been instrumental in regulatory implementation, particularly in the context of financial regulatory reform and oversight following the 2008 financial crisis.
Regulatory Philosophy
SEC Commissioner Hester Peirce’s regulatory philosophy is centered around promoting a more level and predictable regulatory terrain. In her “Limited Mission” speech, she outlined seven steps towards achieving this goal, including a focus on capital formation, improving the efficiency of the SEC’s rule-making process, and enhancing the agency’s engagement with the public. Commissioner Peirce has also emphasized the importance of context in regulation, rather than simply using the term “deregulation.” She believes that the SEC’s focus should be on improving capital markets and enabling markets to flourish, rather than imposing overly restrictive regulations.
The Title of “Cryptomama”
Commissioner Hester Peirce has earned the nickname “Cryptomama” due to her advocacy for a more nuanced approach to regulating cryptocurrency and blockchain technology. As the head of the SEC’s crypto task force, Commissioner Peirce is leading the charge to develop a comprehensive and clear framework for crypto assets. She has expressed a desire to use exemptive authority to help people experiment with crypto technology, and to distinguish between good and bad actors in the crypto space. Commissioner Peirce’s efforts to promote a more favorable regulatory environment for cryptocurrency have earned her a reputation as a champion of innovation and progress in the financial markets.
The title of 'cryptomama' for SEC Commissioner Hester Peirce
During her time at the Commission, Hester Peirce became known for her friendly attitude towards digital assets. The community gave her the nickname "cryptomama" for her constant advocacy for the industry.
Peirce called cryptocurrencies a powerful tool for innovation and economic freedom. In her view, the right regulatory approach should drive technology development, which is why she has repeatedly criticized the agency's denials of bitcoin-ETF registrations, the SEC's stance toward the industry, pointing out the harms of regulatory ambiguity, and called for expedited regulatory rulemaking for the industry.
In February 2020, Peirce proposed a three-year regulatory vacation for tokenizing startups. In April 2021, she presented a second version of a "safe harbor" for ICO projects.
At the same time, the commissioner stated the importance of working with cryptocurrency companies to create a "reasonable framework" for oversight and suggested that the Commission develop a system for engaging with the industry. In her view, excessive enforcement and inconsistent decisions threaten companies leaving for other jurisdictions.
Peirce openly did not support regulator ex.head Gary Gensler's approach to overseeing the crypto market. Specifically, she condemned the SEC's actions in the LBRY case and questioned the usefulness of the Howey test in classifying cryptocurrencies.
Outlook on financial markets
On November 21, 2024, Gensler announced his resignation on the day of Donald Trump's inauguration. The US president-elect had promised to fire the head of the SEC as part of his campaign.
At the time of writing, it is unknown who will head the Commission. According to data from Politico, Pierce is listed as a contender for the seat.
There was support in the community for this scenario. Bankless co-founder Ryan Adams stated that "no one deserves it more." Commenting on his tweet, Coinbase CEO Brian Armstrong called Peirce "the best choice."
However, Unchained sources close to Peirce said she plans to leave the Commission at the end of her term in June 2025. The official "has made it clear she wants to leave the agency," they said. One of the interlocutors noted that he first heard about her desire to resign a year ago.
Nevertheless, the publication's three sources expressed reservations that Peirce could stay on and take over as head of the SEC if the U.S. president asked her to do so directly.
