The cryptocurrency market witnessed a massive surge after Donald Trump won the US presidential election. Over the past week, industry expectations have increased for the newly elected pro-industry administration, as a clearer regulatory framework appears to be within reach.
However, some believe the SEC still needs to do more to develop and implement a friendly approach to the industry.
Regulation by enforcement leaves no ‘clear path’
Recently, SEC Commissioner Hester Peirce join Block and Order podcast to discuss what’s next for the US regulatory agency now that a seemingly crypto-friendly administration has entered the office in 2025.
Cryptocurrency supporter Donald Trump won the US election against US Vice President Kamala Harris last week. During his election campaign, Trump pledged to take a regulatory-friendly approach to the country, starting with firing SEC Chairman Gary Gensler and making the United States the “cryptocurrency capital” of the world.
In addition, the re-elected president promised to preserve Bitcoin (BTC) holdings in the country and work on a regulatory framework for digital assets created by industry experts to support the sector.
However, the SEC has a long history of cracking down on the cryptocurrency industry through a “regulation by enforcement” approach. Commissioner Pierce emphasized that there are far better ways to spend the regulatory agency’s time and resources than “trying to do this through enforcement action.”
Building a well-suited framework for the industry alongside investors and experts would be a better approach, Pearce noted. “The problem with this enforcement action approach is that you end up without a clear path for people to try, and you end up in this discouraging environment,” the SEC commissioner added.
Furthermore, it suggested that clear guidelines and a “disclosure framework” could help investors understand the risks and benefits of projects they want to invest in and know the teams and plans behind them.
Is the SEC ready for a new crypto-friendly administration?
Commissioner Pierce admitted that the SEC’s current approach has created a hostile environment where investors are confused and cryptocurrency companies are afraid to operate in the United States:
It doesn’t have to be this way. Of course, we’re going to have rules, but you never want to put people in a position where they’re afraid to start a business or do business here because they don’t know how the rules are going to work.
The podcast hosts highlighted that the new U.S. regulatory framework could take a few years to develop. However, Pierce noted that the United States has the advantage of taking advantage of what works in other jurisdictions.
She also stressed that the US regulator must address some issues, including speeding up the review process and being more “open.” The SEC commissioner expressed concerns about the approach of the new administration, which was not elected when the interview was recorded, noting that at first “no one knew what to do.”
Pierce noted that being prepared with good ideas by the time the new administration takes office will be key. She is He explained In one of X’s posts, “People inside and outside the agency need to think now about what good cryptocurrency regulation looks like.”
Ultimately, Pierce argues, “we need good ideas to fuel public discussion” that can prepare the new administration and US regulators to change approach.
Total crypto market capitalization is at $2.9 trillion in the weekly chart. Source: TOTAL on TradingView
Featured image from NBC News, chart from TradingView.com
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