SEC Commissioner Esther Pierce believes that the recent actions of US regulators against the BitMEX exchange are a “wake-up call” and a warning for the entire cryptocurrency business.
In early October, the U.S. Commodity Futures Trading Commission (CFTC) filed a lawsuit against the cryptocurrency derivatives exchange BitMEX, accusing its owners of violating KYC/AML procedures and illegal activities in the United States. The U.S. Department of Justice said the maximum penalty for the charges could be 5 years in prison.
BitMEX technical Director Samuel Reed was arrested, but released a few days later on unsecured bail of $5 million. Later, the analytical company Chainalysis classified BitMEX as a high-risk platform.
Commissioner of the U.S. Securities and Exchange Commission (SEC) Hester Peirce believes that the situation with BitMEX will be a warning to other firms in the cryptocurrency industry and a reminder of the need to comply with the requirements of regulatory authorities and American legislation.
“The actions of regulators in relation to BitMEX serve as a loud message to all cryptocurrency firms. If they offer their products or services to U.S. citizens, such firms should be held accountable under U.S. laws, ” she said. Esther Pierce.
She also touched on a topic related to an exchange traded fund (ETF) for bitcoin. Pierce believes that with such a product, institutional investors will be able to access bitcoin in regulated markets. Earlier, the SEC rejected applications from NYSE Arca and Wilshire Phoenix companies to create such a tool, justifying its refusal with possible market manipulation and concern for the rights of investors. However, Pearce does not support this approach of the Commission and called the actions of the department unfair to investors.
“The SEC believes that investors are not able to make reasonable decisions on their own, so it is easier for the Commission to completely protect users from this product. It seems to me that this is pointless. Investors are showing a lot of interest in bitcoin ETFs, and working with this tool, people could become closer to the cryptocurrency industry, ” added Esther Pierce.
Earlier this month, SEC Chairman Jay Clayton expressed interest in tokenizing ETFs and announced the regulator’s readiness to adopt such instruments.