Hester M. Peirce, a member of the Securities and Exchange Commission, is worried that the regulator is moving too slowly for the crypto ecosystem.

Addressing

fellow regulators at the Securities Enforcement Forum in Palo Alto, California (the heart of Silicon Valley) on Monday, Peirce said that one year ago she was concerned that the SEC "as one of [the token market's] potential regulators, would stifle its growth."

She wryly added: "I will admit today that I was very wrong, not about whether the SEC would stifle the industry’s growth—it has—but in how it would do it."

Rather than being heavyhanded in enforcing the rules as she feared, the agency has instead been too sluggish to clarify or update them, Peirce explained:

Her primary concern is that while the SEC has done a great deal to reach out to fast-moving startups, the tools it uses to assess when regulations apply – including the Howey test for determining whether something meets the definition of a security – are still dangerously out-of-date.

To be sure, Peirce credited the SEC for being open and forward-thinking about communicating with startups. The SEC's FinHub network has been leading in startup outreach and most recently held a meetup in Denver where blockchain companies came to speak directly with regulators.

Unfortunately, she said, things aren't moving fast enough on the clarity front:

While emphasizing that she was proud of the work done by the SEC and its attendant securities markets, Peirce warned that the current inertia threatens to undermine those successes, concluding:

Hester Peirce image via Christine Kim for CoinDesk.