- Hester Peirce wishes to see the financial surveillance system modernized.
- The U.S. SEC is currently U-turning on years of anti-crypto policy and enforcement actions.
- Privacy-focused crypto mixer Tornado Cash is currently awaiting a court decision.
Hester Peirce, aka “Crypto Mom,” has called for serious steps to be taken to defend people’s rights to transact privately.
Her words come as a jury decides the fate of privacy-centric crypto mixer, Tornado Cash, whose developers are facing charges for others using their decentralized autonomous tech for illegal purposes.
The Privacy Era
Speaking at the Science of Blockchain Conference, U.S. Securities and Exchange Commission (SEC) commissioner Peirce was critical of the banking system and financial surveillance.
More specifically, she argued that the U.S. financial system is a surveillance state, using the SEC’s investor-tracking Consolidated Audit Trail (CAT) as one example of “dystopian” surveillance programs in the States.
However, the implications for Americans’ privacy are concerning, particularly in the era of cryptocurrency assets.
She says that new technologies can “serve as a catalyst to rethink our financial surveillance regime,” and therefore, “concrete steps” should be taken to protect their right to communicate and transfer value privately.
She says this is what citizens have done with physical coins ever since the Fourth Amendment was written.
Crypto Solutions
Peirce recommended that Americans have their right to self-custody over crypto assets protected, and interestingly, not to criminalize open-source privacy software developers.
She also argues that privacy-preserving technologies, such as zero-knowledge proofs, reduce the need for third-party intermediaries.
“We should not ask peers transacting with one another, where no intermediary exists, to collect and report information on each other. Doing so would deputize us to surveil our neighbors—a practice antithetical to a free society.”
Her comments come at an interesting moment in crypto legal history, where the operators of the privacy-preserving crypto mixer, Tornado Cash, are currently awaiting the jury’s decision that could set a precedent for decentralized software and developers whose tech is used illegally.
Peirce closes by remarking that, while the systems in place that safeguard the nation and its citizens exist because of a “genuine desire” to protect them, they don’t have to come at the cost of privacy or by squashing disintermediating tech.
“The American people and their government should guard zealously people’s right to live private lives and to use technologies that enable them to do so.”
