The US Securities and Exchange Commission (SEC) Commissioner Hester Peirce has reaffirmed the importance of crypto self-custody and financial privacy, emphasizing that individuals have the right to manage their own wealth without relying on third-party services. In a recent interview on “The Rollup” podcast, Peirce, who also heads the SEC’s Crypto Task Force, expressed her support for self-custody, stating that it is a fundamental human right. “I’m a freedom maximalist,” she said, highlighting the need for individuals to have control over their assets.
Peirce’s comments come at a time when the crypto industry is witnessing a shift towards exchange-traded funds (ETFs), which may compromise the ethos of self-custody. Many large Bitcoin whales and long-term holders are opting for ETFs to take advantage of tax benefits and hassle-free management. According to Dr. Martin Hiesboeck, head of research at Uphold, “We are experiencing the first decline in self-custody Bitcoin in 15 years.” This trend has sparked concerns among Bitcoin enthusiasts, who believe that handing over custody to a third party undermines the core values of the cryptocurrency.
Self-Custody and Financial Privacy
Peirce emphasized that financial privacy should be the standard online, stating that “it has become an assumption that you are doing something wrong if you want to keep your transactions private, but it should be exactly the opposite.” She also expressed her support for the Digital Asset Market Structure Clarity Act, which includes provisions for self-custody, anti-money laundering (AML), and asset taxonomy. However, the law has been delayed until 2026, according to Senator Tim Scott.
ETFs and the Shift Away from Self-Custody
The SEC’s approval of in-kind cryptocurrency ETFs in July has contributed to the shift away from self-custody. Dr. Hiesboeck attributed the decline in self-custody Bitcoin to the tax benefits and convenience offered by ETFs. However, this trend has raised concerns among Bitcoin enthusiasts, who believe that it undermines the core values of the cryptocurrency. PlanB, a well-known Bitcoin analyst and investor, sparked an outcry in the Bitcoin community when he announced that he had transferred his Bitcoins into ETFs to reduce the “burden” of managing private keys.
Upcoming SEC Roundtable on Privacy and Financial Surveillance
The SEC will hold a roundtable on privacy and financial surveillance in December, which will provide a platform for discussing the importance of self-custody and financial privacy. As the crypto industry continues to evolve, it is essential to strike a balance between regulation and individual freedom. Peirce’s comments serve as a reminder of the importance of protecting individual rights and promoting financial privacy in the digital age.
For more information on the SEC’s stance on crypto self-custody and financial privacy, visit https://cointelegraph.com/news/crypto-self-custody-fundamental-right-sec-hester-peirce?utm_source=rss_feed&utm_medium=rss_tag_regulation&utm_campaign=rss_partner_inbound
