SEC Commissioner Hester Peirce Defends Crypto Privacy as Constitutional Right

A senior official at the U.S. Securities and Exchange Commission (SEC) has called for stronger safeguards for the financial privacy of cryptocurrency users, framing it as a constitutional right essential to individual liberty. Speaking at the Science of Blockchain Conference in Washington D.C. on August 4, 2025, SEC Commissioner Hester Peirce criticized financial surveillance efforts she said threaten the decentralized nature of blockchain technology [1].

Peirce emphasized the role of permissionless crypto systems in enabling individuals to control their financial activity without relying on centralized entities that are legally obligated to monitor and report user behavior [2]. She highlighted technologies such as zero-knowledge proofs, decentralized finance (DeFi) protocols, and other privacy-enhancing tools as vital infrastructure for preserving digital liberty [3].

In a direct critique of the Bank Secrecy Act (BSA), Peirce argued that it effectively turns banks into government surveillance agents. She warned that imposing intermediary-like obligations on decentralized networks undermines their fundamental design and could stifle innovation [4]. Peirce also rejected regulatory frameworks that she said are outdated and incompatible with the decentralized architecture of blockchain systems [5].

The commissioner further called on regulators to recognize that financial privacy is not a loophole but a constitutional right. She cited the Fourth Amendment, noting that individuals once had the ability to transfer value privately using physical coins, and that this right should extend to the digital realm [6]. Peirce urged for a balanced approach that respects user autonomy while addressing concerns around financial crime and compliance [7].

Peirce’s remarks align with her broader advocacy for crypto privacy, including her calls for modernized regulations and greater adoption of privacy-preserving technologies. She has also supported initiatives like the SEC’s Project Crypto, which seeks to deepen regulatory understanding of the crypto landscape [8]. Her stance has earned her the nickname “Crypto Mom” within the industry, reflecting her consistent and vocal support for user rights in the digital asset space [9].

Peirce’s recent statements reinforce a growing push to defend the privacy of crypto users, particularly in the context of legal challenges against tools like Tornado Cash. She stressed the importance of striking a balance between privacy rights and regulatory concerns, arguing that financial privacy is a foundational element of democratic freedom [1].

Source:

[1] Hester Peirce Calls for Modern Financial Privacy ... (https://www.ainvest.com/news/hester-peirce-calls-modern-financial-privacy-regulations-crypto-era-2508/)

[2] Hester Peirce Defends Crypto Privacy Amid Tornado Cash ... (https://cointelegraph.com/news/hester-peirce-defends-crypto-privacy-tornado-cash-trial)

[3] Hester Peirce Pushes To Protect Privacy and Crypto ... (https://www.ccn.com/news/crypto/sec-hester-pierce-crypto-privacy-disintermediation/)

[4] Peanut Butter & Watermelon: Financial Privacy in the ... (https://www.sec.gov/newsroom/speeches-statements/peirce-remarks-blockchain-conference-080425)

[5] SEC's Hester Peirce Pushes Back on Crypto Surveillance (https://www.bitdegree.org/crypto/news/sec-commissioner-hester-pierce-pushes-back-against-crypto-surveillance-rules)

[6] SEC Commissioner Hester Peirce Advocates for Digital ... (https://www.ainvest.com/news/sec-commissioner-hester-pierce-advocates-digital-financial-privacy-custody-2508/)

[8] SEC's Peirce Defends Crypto Privacy Rights as Tornado ... (https://cryptonews.com/news/secs-peirce-defends-crypto-privacy-rights-as-tornado-cash-developer-awaits-verdict/)