SEC's Peirce: Many Meme Coins Escape Regulatory Net

SEC Commissioner Hester Peirce has stated that many meme coins likely fall outside the regulatory scope of the Securities and Exchange Commission (SEC). In an interview with Bloomberg Crypto, Peirce indicated that the SEC's current regulatory framework may not cover a significant number of meme coins, which are digital assets often associated with internet memes or popular culture.

Peirce, who heads the SEC's crypto task force, emphasized the importance of evaluating each meme coin on a case-by-case basis, as "facts and circumstances matter" in determining whether a particular coin falls under the SEC's jurisdiction. She acknowledged that many meme coins may not be subject to the SEC's regulations, suggesting that Congress or the Commodity Futures Trading Commission (CFTC) could provide clarity on the regulatory landscape for these assets.

Peirce also discussed the SEC's approach to crypto regulation, noting that the agency has historically relied on enforcement actions to establish regulatory policy. She expressed a desire to shift this approach by setting clear regulatory policies and then bringing enforcement cases as needed. The Commissioner acknowledged the need to review and untangle existing cases individually.

Peirce, who describes herself as a "freedom maximalist," criticized the current regulatory environment for crypto, arguing that it has stifled innovation. She believes the SEC should focus on creating "basic parameters" within which innovation can flourish, while still protecting investors. Peirce emphasized that regulation should not be used to prevent people from exploring new and interesting ideas in the crypto space.

In addition to her comments on meme coins and the SEC's approach to crypto regulation, Peirce discussed other key issues, including the agency's efforts to process applications for exempt relief, particularly for exchange-traded products (ETFs), and its willingness to work with crypto exchanges seeking registration. She also mentioned that the SEC is collaborating with the CFTC on various issues, including derivatives policy, and is open to continuing that collaboration on crypto policy.