SEC Commissioners Hester Peirce and Mark Uyeda have publicly criticized the U.S. Securities and Exchange Commission’s (SEC) enforcement action against cryptocurrency firm ShapeShift, calling it an addition to the “ambiguity” in the industry.
The SEC’s settlement with ShapeShift, which involved a US$275,000 penalty for allegedly offering unregistered securities, was announced on March 5. The commissioners argued that the SEC’s order did not clarify which of the 79 crypto assets offered by the exchange were considered securities.
Peirce and Uyeda have been vocal critics of their agency’s approach to crypto enforcement, which has included actions against major exchanges like Binance and Coinbase.
SEC Chair Gary Gensler has maintained that many cryptocurrencies are securities and that crypto platforms should register with the agency, a stance that has been met with resistance from the crypto industry seeking clearer regulatory guidelines.
ShapeShift, an early crypto exchange that allowed users to swap cryptocurrencies without an account, started to transition into a decentralized autonomous organization (DAO) in 2021.
Despite the change in its business model, the SEC’s recent action pertains to activities between 2014 and 2021, during which ShapeShift traded 79 crypto assets. The settlement requires ShapeShift to cease and desist from future violations and pay the civil penalty within two weeks of the order’s issuance.