SEC’s Pierce Returns to the Warpath to Criticize Poloniex Settlement

Exchanges Regulation SEC USA
Last updated:
Author
Author
Tim Alper
About Author

Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

Last updated:
Why Trust Cryptonews
With over a decade of crypto coverage, Cryptonews delivers authoritative insights you can rely on. Our veteran team of journalists and analysts combines in-depth market knowledge with hands-on testing of blockchain technologies. We maintain strict editorial standards, ensuring factual accuracy and impartial reporting on both established cryptocurrencies and emerging projects. Our longstanding presence in the industry and commitment to quality journalism make Cryptonews a trusted source in the dynamic world of digital assets. Read more about Cryptonews

One of the commissioners of the America financial regulator, the Securities and Exchange Commission (SEC), has launched another blistering attack on her own organization after the Poloniex crypto exchange agreed terms on a circa USD 10.4m settlement, claiming that the trading platform would have waited in vain should it have attempted to follow the rules the SEC insists upon.

Source: A screenshot, Youtube/CNBC Television

The SEC had served Poloniex with a cease and desist order, claiming that it had illegally operated a trading platform that allowed customers to buy and sell what it termed digital asset “securities.”

The remarks came from Hester Peirce, one of the SEC’s five commissioners, who authored a public statement in the wake of the SEC’s announcement. Peirce lamented the SEC’s apparent indecision and slow pace of progress in dealing with registration-related requests. She stated that while Poloniex “could have tried to register as a securities exchange” or as “a broker-dealer to operate an alternative trading system (ATS),” but “had it done so, it likely would have waited…and waited…and waited some more.”

Peirce wrote:

“Given how slow we have been in determining how regulated entities can interact with crypto, market participants may understandably be surprised to see us come onto the scene now with our enforcement guns blazing and argue that Poloniex was not registered or operating under an exemption as it should have been.”

The SEC commissioner wrote that the organization needed to “acknowledge the need to come up with sensible solutions,” and listed a number of matters “raised by entities that want to participate in this area.”

“Assuming Poloniex or another crypto trading platform determines to register with us as an exchange or an ATS, we need to answer a number of questions,” Peirce advised.

She stated that platforms needed to be provided with answers about crypto custody and liquidity, market-making functions and retail investor relations, whether they could “trade non-securities alongside securities” and perhaps the most pertinent question of all:

“How can a trading platform and its customers determine whether a particular digital asset is a security?”

Poloniex did not admit or deny the SEC charge, but instead agreed to pay disgorgement, interest, and an additional civil penalty fee.

Peirce has been openly critical of such SEC cases in the past. Last month, she and fellow commissioner Elad Roisman issued a joint public statement after the SEC settled with the British firm Blotics, the operator of the Coinschedule website.

At the time, the duo wrote that they were “disappointed” that the commission had failed to “explain which digital assets touted by Coinschedule were securities,” calling the “omission” “symptomatic of our reluctance to provide additional guidance about how to determine whether a token is being sold as part of a securities offering or which tokens are securities.”

____

Learn more:
Crypto Industry Finds Bright Side after Infra Bill Amendment Fails
SEC to Provide Clarity on Token Distribution, Crypto-Based ETPs – Hester Peirce

SEC Charges ‘Defi’ Lender, Governance Token Issuers Should Take Notice
SEC Boss Gensler Hints that He Could Seek to Regulate DeFi

Ripple Asks Court to Throw out SEC Case Following Commissioners’ Letter
SEC Asks Court to Let it See Evidence of Ripple’s ‘XRP Lobbying’

Altcoin News
Dogecoin Surges 45% as Bitcoin Hits New ATH Amid Post-Election Optimism
2024-11-12 06:29:53
,
by Ruholamin Haqshanas
Bitcoin News
Bitcoin Is Becoming a ‘Political Imperative’ After Trump’s Win: NYDIG
2024-11-11 18:11:23
,
by Hongji Feng
Price Analysis
Bitcoin Price Hits All-Time High of $84,000 – How Quickly Can BTC Get to $100,000?
2024-11-11 16:00:29
,
by Arslan Butt

Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.

More Articles

Industry Talk
Best Crypto to Buy Now November 12 – Bonk, Cronos, Neiro
Jimmy Aki
Jimmy Aki
2024-11-12 17:18:45
Industry Talk
Top Crypto Gainers Today on DEXTools – MAGA, TOME, SGUN
Jimmy Aki
Jimmy Aki
2024-11-12 16:54:03
Crypto News in numbers
editors
Authors List + 66 More
2M+
Active Monthly Users Around the World
250+
Guides and Reviews Articles
8
Years on the Market
70
International Team Authors