SEC Commissioner Hester Peirce has criticized the agency’s guidance on crypto custody and called for more public interaction. Peirce referred to the regulator’s policy guidelines as a “particularly pernicious weed” in their “secret garden.” She specifically mentioned the Staff Accounting Bulletin 121, which prevents banks from holding crypto assets on behalf of clients. Gurbir Grewal, the director of the Division of Enforcement at the SEC, pushed back against criticism that the regulator is making up rules on crypto. He stated that companies in the crypto industry have attempted to avoid the SEC’s jurisdiction by continuing to operate in the United States. Grewal emphasized that the SEC’s standard for determining security under the Howey test has been consistently applied. He did not address reports regarding the SEC’s consideration of classifying Ether as a security rather than a commodity. The SEC is currently seeking public comments on proposed rule changes for listing and trading shares of three spot Ether exchange-traded funds. Bitwise, Fidelity, and Grayscale have submitted applications for these ETFs. The European Union is considering banning non-decentralized protocols and is evaluating the decentralized finance market. Argentina’s securities regulator, Comisión Nacional de Valores, requires crypto firms to register in accordance with recommendations from the Financial Action Task Force. Virtual asset service providers that are not registered will not be able to operate in the country. The Monetary Authority of Singapore will implement amendments to the Payment Services Act to expand the scope of regulated services for digital payment token service providers. The changes include providing custodial services for digital payment tokens and facilitating token transfers and exchange. The regulator clarified that these regulations even apply when the service provider does not possess the funds or when the money is not accepted or received in Singapore.
Law Decoded: Hester Peirce slams SEC, Gurbir Grewal dismisses SEC critique