SEC commissioner Hester Peirce says proposed Exchange Act changes threaten free speech

Securities and Exchange Commission’s commissioner Hester Peirce has criticized the regulator’s proposed amendment to the Exchange Act, aimed at amending the definition of the term “exchange.” In a statement, Peirce said that the “Commission aggressively expands its regulatory reach to solve problems that do not exist.” From the statement: “The release’s ambiguity undermines fundamental First Amendment protections. “Because the release makes everybody involved in the relevant blockchain ecosystem part of a ‘group,’ it creates significant ambiguity around what speech requires government pre-approval, which will unavoidably chill constitutionally-protected speech. The reopener suggests that an individual, who, ‘acting independently and separate from an organization’ and without any agreement for that code to be used in a trading venue, publishes code ‘may be less likely’ to be part of a group for these purposes. On the other hand, an organization that ‘deploys’ such code likely would be part of a group that would trigger registration requirements. And if you are a paid developer, you ‘could be acting in concert with a group of persons to provide a market place or facilities for bringing together buyers and sellers.’ “What does all of this mean? Do First Amendment protections extend only to code published by hobbyist coders? Does a university professor who, as part of her research publishes such code, risk triggering the exchange definition merely because she is paid for that research? Is a non-profit organization subject to First Amendment protections different from those available to individuals? Is such an organization that deploys experimental…SEC commissioner Hester Peirce says proposed Exchange Act changes threaten free speech