SEC Commissioner Hester Peirce argues truly decentralized DeFi requires no legal exemption

SEC Commissioner Hester Peirce stated on Sept. 17 that investors do not require legal exemptions to utilize permissionless smart contracts for peer-to-peer trading. She emphasized that truly decentralized systems should operate outside the scope of regulated intermediaries. While the SEC and CFTC are examining the extent of control software providers retain, a unified federal decentralization test has yet to be established. The SEC's recent order regarding tokenized securities provides conditional relief for specific venues but leaves the definition of "truly decentralized" open to interpretation.