SEC's Peirce: Memecoins May Evade Regulation

The U.S. Securities and Exchange Commission (SEC) may not have jurisdiction over many memecoins, according to Commissioner Hester Peirce. In a recent interview, Peirce stated that these tokens, which lack a clear long-term value proposition, may not fall under the SEC's current regulatory purview. She suggested that Congress or the Commodity Futures Trading Commission (CFTC) could address this issue if they choose to do so.

Memecoins, unlike cryptocurrencies like bitcoin and ether, have no inherent value. Industry figures have long argued that these tokens should not be regulated as securities, comparing them to digital collectibles like beanie babies or baseball cards. Peirce's hands-off stance represents a shift from the SEC's previous approach under former Chairman Gary Gensler, who frequently asserted that all crypto tokens aside from Bitcoin were securities.

Acting Chair Mark Uyeda recently announced the formation of a new Crypto Task Force, led by Peirce, signaling a shift away from the so-called "regulation by enforcement" practiced by Gensler. The task force's top priorities include resolving the question of what makes a crypto asset a security versus a commodity and creating a more viable path to registration by modifying the SEC's existing paths.

Peirce has previously expressed her views on memecoins, stating that individuals should be free to make their own decisions but should not expect the government to bail them out if their investments do not pan out. She believes that people should be aware of the risks associated with these tokens and make informed decisions accordingly.