US Security and Exchange Commission Commissioner Hester Peirce has criticized her agency’s guidance on crypto custody and called for more public participation.
Addressing the SEC Speaks Conference on April 2, Peirce, known as ‘Crypto Mom’ in the crypto community, expressed her concerns about the controversial Staff Accounting Bulletin 121 (SAB 121).
This bulletin, released by the SEC in March 2022, outlines accounting guidelines for institutions holding crypto assets. Peirce argued that the bulletin, which prevents many banks from offering crypto custody services, is not effectively protecting investors.
Instead, it excludes experienced banks and broker-dealers from the market due to its capital implications. She also warned that if a custodian fails, the assets could be treated as belonging to the failed entity, not the customers.
Peirce called for more collaboration with the banking sector and public input in shaping policies in the crypto industry.
