With Hester Peirce’s SEC Exit, Crypto Industry Loses an Ally

It’s closing time for Crypto Mom’s SEC. 

Friday marks the last day of Hester Peirce’s tenure at the agency, according to her recent resignation letter to President Trump. The commissioner will be returning to academia as an associate professor at the Regent University School of Law, the school announced in May. 

Peirce, who took office in 2018, was a fierce advocate for the crypto industry. She urged the Securities and Exchange Commission to provide clear regulatory roadmaps for digital assets instead of regulating through enforcement, and she publicly criticized her own agency’s early rejections of spot bitcoin ETFs. But now, she’s making her exit when crypto-related lawmaking is at an inflection point: The CLARITY Act, which would have provided a regulatory framework for digital assets, failed to win enough Senate votes to advance this month. The SEC has made it clear it will offer guidance where it can without Congress’ buy-in, most recently via a five-year exemption that allows trading venues to offer tokenized stocks. 

“With Commissioner Peirce’s departure, the SEC has lost a trailblazer who was not afraid to advance boundary-pushing policy ideas,” said Arun Sundararajan, a professor at New York University’s Stern School of Business. “Her influence will remain with the regulatory direction she helped advance, away from enforcement and regulatory ambiguity and towards clear, technology-neutral rules.” 

Crypto’s Regulatory Future  

Peirce helped usher in a new era for Wall Street’s watchdog. “Now that the SEC has gotten to a place of embracing new financial technology, it seems a good time for her to move on,” said Steven McClurg, founder and CEO of crypto-focused asset manager Canary Capital. 

Will her departure change the landscape for crypto investment products? 

• Nate Geraci, president of NovaDius Wealth Management, said he doesn’t believe it’ll have a meaningful impact on the future of crypto ETFs, given the SEC’s much more crypto-friendly posture today.
• But while SEC Chair Paul Atkins and Commissioner Mark Uyeda share her market-driven approach, an immediate challenge to new regulation will be whether they can reach unanimity, Sundararajan said. “A two-commissioner agency leaves no margin of error for reaching quorum.” 
• The agency may also shift its focus away from crypto and toward addressing the sudden increases in systemic risk from generative and agentic artificial intelligence, Sundararajan said. 

A Final Word: There’s plenty Peirce would have liked to do at the SEC, including finalizing transfer agent rules, work related to investment advisor and investment company custody, and starting a compliance officer advisory committee, she recently told The Block. But now that that’s in other commissioners’ hands, her advice for them is fairly simple. “Keep seeking public input,” she said. “We need to be working with a whole range of people on the outside, not just people who are in the crypto industry, but people who are critical of the crypto industry as well.”