SEC Commissioner Peirce Chats About DeFi, Tokens and Her Unikrn Dissent at LA Blockchain Summit

While Peirce steered clear of commenting on specific DeFi projects like SushiSwap, she pointed out that issuers of governance tokens do have to think about how they share characteristics with equities.

AccessTimeIconOct 6, 2020 at 10:20 p.m. UTC
Updated Sep 14, 2021 at 10:05 a.m. UTC

U.S. Securities and Exchange Commissioner Hester Peirce discussed some major trends in the digital asset world during a chat with journalist Laura Shin at the LA Blockchain Summit on Tuesday. 

While the talk kicked off with Peirce’s letter of dissent against the recent SEC decision to levy a $6.1 million fine on Unikrn, the commissioner spoke about a range of topics including decentralized finance (DeFi), her safe harbor proposal for token issuers and whether token airdrops and DeFi governance tokens could run into securities regulations. 

At the beginning of the talk, Peirce noted the views laid out in the chat were her own and in no way represent the SEC or her fellow commissioners.

  • Regarding the Unikrn settlement, Peirce said she felt it was a “rather heavy-handed” settlement over allegations of registration violation. “The message that we send with a case like that is one that is basically, if you want to do innovation go somewhere else to do it,” she said. 
  • Addressing regulations around token airdrops, Peirce stressed that people should come talk to the SEC about how they intend to distribute tokens. While the SEC has previously indicated airdrops could be seen as security offerings, Pierce said giving something away was clearly distinct from selling something. 
  • “But again, I caution people that I'm one person on the commission. There are other people on the commission who might look at the same facts and circumstances differently than I do,” said Peirce.
  • Speaking about whether governance tokens used by many DeFi platforms could be treated like a securities offering, Peirce said that even though the tokens carry some equity-like benefits, multiple questions regarding regulatory structure and how these tokens could affect corporate governance continue to linger.


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