Outgoing U.S. Securities and Exchange Commission Commissioner Hester Peirce said two big jobs in crypto regulation are still unfinished as she gets ready to leave the agency this month: protecting developers and protecting financial privacy.
In a farewell interview with The Block, Peirce reflected on nearly 10 years of SEC oversight of crypto. Her take was plain: the agency should have written rules sooner, instead of letting the industry waste time and money on what she called unnecessary regulatory and enforcement fights.
Peirce described her exit in modest terms, saying, "One commissioner's departure is really not that important; the agency's work keeps going." She has served during the tenures of Jay Clayton, Gary Gensler, and Paul Atkins, which makes her one of the few commissioners leaving behind a crypto regulatory record under both Republican and Democratic administrations.
According to the report, she criticized the SEC's enforcement approach toward companies including CoinDesk, later pushed for a crypto task force to be created, and publicly supported clearer SEC staff guidance on staking.
Rules came too late, Peirce says
Asked about her biggest regret in crypto regulation, Peirce said the real issue was timing. Too much effort, in her view, got burned on avoidable fights with regulators and enforcement staff when that same effort could have gone into building a framework that protects investors and developers alike.
"When you regulate technology and get it wrong for a long time, the damage can last a long time, and a lot of people can get hurt," she said.
She also said she has seen a change over the past two years. The SEC, in her view, has become more willing to write rules instead of leaning so heavily on enforcement pressure. She pointed to Regulation Crypto Assets, the innovation exemption, and joint SEC-CFTC staff guidance as examples.
Developer protection tops her unfinished agenda
When she was asked what crypto issue she most wanted to finish before leaving, Peirce answered right away: developer protection.
"We have to make sure developers feel protected so they can work with peace of mind and not worry that if someone uses a tool they built to do something bad, they will be blamed too," she said.
Peirce argued that developers who are simply building tools should not be on the hook when those tools are misused. That gets to the heart of decentralized blockchain design: once a smart contract is deployed, anyone can interact with it.
Her view was blunt. If developers get scared to write code because they think the SEC might come after them, the U.S. falls behind in the race for the technology.
Financial privacy is still on her list
Her second big concern was financial surveillance. Peirce said the U.S. now leans too much on financial data when investigating crime, and not just in money laundering cases. Ordinary criminal matters too.
"We need to get back to a place where personal privacy matters, where people do not have to share their financial information with everyone," she said.
She put crypto squarely in that argument. Blockchain privacy protections, she said, should not be treated as if they exist only for criminals. They can also give ordinary people a way to avoid blanket surveillance.
The report tied that view to her 2024 speech, Peanut Butter & Watermelon: Financial Privacy in the Digital Age.
Intermediaries and real decentralization are not the same
Peirce also took on a point she thinks the industry often smudges: decentralization is not a free pass.
If a project has intermediaries, she said, then it should be regulated the way existing intermediaries are regulated, because intermediaries can steal funds, act negligently, or get hacked. That's the reason regulation exists.
And she said the industry should stop claiming to be truly decentralized when it is not. In those cases, she said, the SEC has to push back.
At the same time, she drew a line around genuine peer-to-protocol activity. If transactions happen directly through smart contracts, with no intermediary involved, then a different regulatory logic should apply, she said.
Still hopeful on the Clarity Act
Asked about the Clarity Act, which the report said has stalled in the Senate and does not look likely to pass this year, Peirce said she still has hope.
"I still hope Clarity can pass. This is major legislation, and a lot of people have put a lot of time into it," she said.
But she also sketched out a backup plan. In her view, the SEC already has enough authority to write rules, and the agency should use the authority it already has to do what it can before legislation arrives.
Peirce also stressed a point about staying power. If the industry wants rules that stick, it has to build products inside that framework and give people things they actually use and value. Rules that help a growing technology are harder to strip away.
Next stop: Regent University School of Law
After leaving the SEC, Peirce will join Regent University School of Law as an associate professor, where she will teach securities law and writing.
She said what she is most excited about is working with a generation of law students entering a very different world.
The interview also included a personal note. Peirce said she likes baking bread, but she recalled that a sourdough starter once "blew up" a refrigerator while she was in law school, which left her roommate angry. She said that is still the picture she sees whenever she thinks about sourdough.
What happens inside the SEC after Peirce leaves
The report said that once Peirce departs, the SEC board will be left with Republican Chair Paul Atkins and Commissioner Mark Uyeda. Democrats, meanwhile, have been urging the Trump administration to nominate more commissioners and restore a five-member bipartisan board.
So there is a practical question hanging over all this. The SEC is still working on the innovation exemption, which the report described as a five-year limited exemption, along with a permanent rule set. But the issues Peirce hammered on most — developer protection, financial privacy reform, and how intermediaries are defined — will need someone inside the commission to keep pushing them.
Peirce said one commissioner's departure is not all that important. For the crypto industry, though, her exit may sharpen another reality: commissioners who understand the technology and are willing to argue for change from inside the agency are hard to replace.