Hester Peirce lambastes the SEC while Gurbir Grewal dismisses criticism: Law Decoded

SEC Commissioner Hester Peirce has criticized her agency’s guidance on crypto custody and called for more public interaction. During the SEC Speaks conference, Peirce referred to the Staff Accounting Bulletin 121 (SAB 121) as a “particularly pernicious weed” in the SEC’s “secret garden” of policy guidelines. The SAB 121 prevents banks from holding crypto assets on behalf of clients. Meanwhile, Gurbir Grewal, the director of the Division of Enforcement at the SEC, defended the regulator against claims of making up rules on crypto. He stated that companies in the crypto industry have attempted various methods to avoid the SEC’s jurisdiction. Grewal also reaffirmed the SEC’s consistent application of the Howey test to determine security. The SEC is currently seeking public comments on proposed rule changes for the listing and trading of spot Ether exchange-traded funds (ETFs). Bitwise, Fidelity, and Grayscale have submitted applications for spot ETH ETFs. In Europe, the Markets in Crypto-Assets Regulation (MiCA) may lead to a ban on non-decentralized protocols. The European Commission is expected to evaluate the decentralized finance market and consider specific regulations for the sector. Argentina’s Comisión Nacional de Valores (CNV) has mandated that crypto firms register with the government. This move aligns with recommendations from the Financial Action Task Force. Virtual asset service providers that fail to register will no longer be able to operate in the country. The requirements could impact businesses and customers seeking to use their services. In Singapore, the Monetary Authority of Singapore (MAS) plans to expand the scope of regulated services related to digital payment token (DPT) service providers. Amendments to the Payment Services Act will include custodial services for DPTs, token transfers, and cross-border money transfers. MAS will also introduce additional requirements for DPT service providers.