Speaker 1: You can have a token that is not itself a security,
Speaker 1: but is offered in a transaction that is a securities offering.
Speaker 1: Thinking about how that applies, I think that's really caused
Speaker 1: Congress and us at the SEC to think about what
Speaker 1: kind of rules make sense here. Congress has the opportunity
Speaker 1: now to write a new framework.
Speaker 2: So, Commissioner Purse, you mean the oranges in my house
Speaker 2: right now are the supermarket are not securities?
Speaker 3: Because how I'm.
Speaker 1: Going to say? They're not securities, but you could still
Speaker 1: figure out a way to sell them in a transaction
Speaker 1: that is a securities transaction.
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Speaker 2: the Thinking Crypto podcast. I'm your host Tony Edward, and
Speaker 2: we are recording at Station three in New York's Financial
Speaker 2: District and my guest is SEC Commissioner Hester Perce, Commissioner Perse.
Speaker 3: Great to see you, Tony.
Speaker 1: It's great to be you, know how I have to
Speaker 1: start my views and my own views as a commissioner,
Speaker 1: not necessarily those of the SEC or my fellow commissioners.
Speaker 2: Absolutely, we've spoken many times over the years, so I'm
Speaker 2: excited to be having this conversation with you now because
Speaker 2: things have changed completely. It's a great time to be
Speaker 2: in the crypto industry. Lots happening in DC, lots happening
Speaker 2: at the SEC. You're in town for a crypto roundtable?
Speaker 3: Is that right?
Speaker 1: That's right. We've had a series of roundtables this year.
Speaker 1: The first we're sort of issue oriented. We talked about
Speaker 1: things like what is the definition of a security as
Speaker 1: it relates to crypto. We talked about custody trading. And
Speaker 1: now what we're trying to do is go out on
Speaker 1: the road and meet with smaller projects that maybe wouldn't
Speaker 1: have a chance to travel to DC and so trying
Speaker 1: to hear their feedback.
Speaker 2: So the roundtables, it sounds like you've got a lot
Speaker 2: of good reception. Folks are engaging, they're talking and sharing
Speaker 2: their thoughts and things like that.
Speaker 1: Yeah, we've gotten a lot of great reception, not only
Speaker 1: to the tables, but also I put out a set
Speaker 1: of questions in February and we're still getting great answers
Speaker 1: to those questions. In so the feedback is really important
Speaker 1: for us to try to figure out how to move
Speaker 1: forward in a way that's productive.
Speaker 2: Well, I got to give you your flowers, thank you
Speaker 2: for being a leader, and you know, having to transparency
Speaker 2: and meeting with folks and some the small entrepreneurs and innovators.
Speaker 3: So that's really great to hear.
Speaker 2: Well.
Speaker 1: I mean again, it's their giving of their time to
Speaker 1: help us get to a better place, and I think
Speaker 1: it's nice of them to be willing to do that.
Speaker 2: Now, a good great segue it is into Project Crypto,
Speaker 2: which was announced by Chair Paul Adkins and some of
Speaker 2: the initiatives you're going to be doing there. Tell us
Speaker 2: a bit about Project Crypto, what's the goal and some
Speaker 2: of the recent initiatives.
Speaker 1: The goal of Project Crypto is to really provide the
Speaker 1: clarity that the industry has been asking for now for
Speaker 1: as long as we've been talking to each other and longer,
Speaker 1: and so really to get to the place where someone
Speaker 1: who's trying to launch a crypto project knows what the
Speaker 1: possible avenues are to do that in a way that's
Speaker 1: compliant in the US. And so we've started out by
Speaker 1: providing some guidance. We're working the Crypto Task Force is
Speaker 1: a set group of people at the SEC, but we're
Speaker 1: working with staff across the agency, and so you might
Speaker 1: have seen there are some guidance that's come out around
Speaker 1: things like meme coins around mining staking, and we're looking
Speaker 1: at providing more working with the staff to provide more
Speaker 1: of that type of guidance, also to bring that guidance
Speaker 1: up to the commission level where possible, so that it
Speaker 1: has a little bit more staying power, and then to
Speaker 1: get to even more staying power, we're looking at writing
Speaker 1: rules where that's appropriate, working also with Congress on the legislation,
Speaker 1: providing technical assistance there, and then looking at ways we
Speaker 1: can provide exemptions for people who have specific things they're
Speaker 1: trying to do. And so that's it keeps us very busy,
Speaker 1: but that's kind of a little bit of what we're
Speaker 1: trying to achieve.
Speaker 2: And there's so much in the crypto space. I'm neck
Speaker 2: deep in it in the day to day, but it's
Speaker 2: always something new, which is great.
Speaker 3: It's innovation.
Speaker 2: So I can can't imagine what it's like for you guys,
Speaker 2: and you know, trying to figure out all these nuts
Speaker 2: and bolts and components of this industry. You know, you
Speaker 2: mentioned meme coins and liquid staking, excuse my ignorance on this.
Speaker 2: So the guidance that you put out there, does that
Speaker 2: automatically get added to like the Clarity Act and legislation
Speaker 2: that Congress is working on.
Speaker 1: No. What it does though, is it helps Congress focus
Speaker 1: because we say, look, some of these things just are
Speaker 1: not in our jurisdiction that we have. Now, if Congress
Speaker 1: wants to give someone jurisdiction over those things, it can,
Speaker 1: but it doesn't need to. So it's really more of
Speaker 1: just telling people out in the world who are either
Speaker 1: buying meme coins or who are issuing them that it's
Speaker 1: it's not generally within our wheelhouse. Now, it's always important
Speaker 1: to say, you know, we're lawyers here. Well, I'm a lawyer,
Speaker 1: so facts circumstances matter. Yeah, And so you can take
Speaker 1: something that is not a security and you can offer
Speaker 1: it in a way that it is a security, as
Speaker 1: probably a lot of people in this space know. That's
Speaker 1: kind of where the Howie test comes in.
Speaker 2: Absolutely, and again another question where I think I'm very
Speaker 2: curious about. So let's say meme coins are not securities.
Speaker 2: But in every market there are bad actors. They're good
Speaker 2: actors and bad actors people who come in and try
Speaker 2: to take advantage of folks. So we've seen certain folks
Speaker 2: launch meme coins and they do what's called a rug pull.
Speaker 2: Is the SEC involved in that, or is a law
Speaker 2: enforcement there are folks who have to handle that.
Speaker 1: I think that's one of the reasons that we wanted
Speaker 1: to put out this guidance is to say people need
Speaker 1: to be careful out there because sometimes you are buying
Speaker 1: something that is not a security and then when something
Speaker 1: bad happens, you see people coming to the SEC and saying,
Speaker 1: can you help us, can you get our money back?
Speaker 1: And if it wasn't a securities transaction, there's really nothing
Speaker 1: we can do. And even sometimes when it is a
Speaker 1: securities transaction, the money is already gone. So I really
Speaker 1: urge people to be very careful to think about whether
Speaker 1: they can afford to lose the money that they're buying.
Speaker 1: They're using to buy something, there's a lot of hype
Speaker 1: and there's a lot of excitement. Yeah, doesn't mean that
Speaker 1: you're going to come away from this a millionaire. You
Speaker 1: may come away from this having a lot less money
Speaker 1: than you did when you went in. So people need
Speaker 1: to be careful. But yes, when there are frauds, there
Speaker 1: may be another government agency, whether at the state or
Speaker 1: federal level, that can go after those fraudsters. But it's
Speaker 1: not always the SEC. I think sometimes people think whenever
Speaker 1: something bad happens in the in this general realm, that
Speaker 1: it's the SEC and that's just not the case.
Speaker 2: Yeah, And it's also finding that balance because I believe
Speaker 2: in the free market, you can go plate a lot,
Speaker 2: or you can want you can go to vegas and gamble,
Speaker 2: but you got to know, you've got to have self control,
Speaker 2: you got to do your research, you got to be smart.
Speaker 2: There's a responsibility to the individual, right.
Speaker 1: Absolutely, right. I think that's how the free markets work
Speaker 1: and how this an environment in which we don't tell
Speaker 1: you exactly what you can and can't buy. That means
Speaker 1: that you do have to take that responsibility yourself and
Speaker 1: exercise some judgment. And if you if you want to
Speaker 1: go have fun and you don't want to do your research,
Speaker 1: that's fine, but then the consequences might not be good.
Speaker 2: Yeah, Yeah, that definitely makes sense. Now, another big guidance
Speaker 2: you folks provided was liquid staking. Certain liquid staked activities
Speaker 2: are not securities.
Speaker 3: That's huge.
Speaker 2: You know. I've spoken to it of folks that like
Speaker 2: lightoh and so forth, and they find this guidance to
Speaker 2: be incredible. Talk to us about talk to us a
Speaker 2: bit about the approach to liquid staking and the staking
Speaker 2: marketing in general.
Speaker 1: The approach we're taking is that because it's really more
Speaker 1: of a technical service than anything else, it doesn't make
Speaker 1: sense for it to be within our ambit. When there's
Speaker 1: discretion that is involved, that sort of changes the dynamic.
Speaker 1: But when it's more of a technical service, then that
Speaker 1: wouldn't fall within the SEC's jurisdiction.
Speaker 3: Got it.
Speaker 2: There was recent news that members of the House, a
Speaker 2: few legislators send I shouldn't say a few nine in fact,
Speaker 2: send a letter to SEC Chair Paul Atkins about opening
Speaker 2: up investments in four to one case, which included crypto
Speaker 2: talk to us a bit about that. Is this also
Speaker 2: in the general movement of relaxing accreditation laws and things
Speaker 2: like that.
Speaker 1: Yeah, I think there's been a realization that as the
Speaker 1: public markets have faced more competition frankly from the private markets,
Speaker 1: more activity is happening in the private markets, and retail
Speaker 1: investors are effectively shut out of those markets now, and
Speaker 1: so there's been more interest in seeing if we can
Speaker 1: figure out a way to give retail investors access to
Speaker 1: the private markets so that they can diversify their portfolios more.
Speaker 1: And one way to do that would to open up
Speaker 1: possibilities through your four oh one K of what you
Speaker 1: could invest in. Now again, people need to be careful, right,
Speaker 1: because if you're investing your retirement funds in something, you
Speaker 1: need to be thinking about how much money do you
Speaker 1: need in retirement, how much do you have, what's the
Speaker 1: risk associated? So people need to do that calculus. But
Speaker 1: the idea is to get broader diversification to people who
Speaker 1: are now really prohibited from diversifying.
Speaker 2: And I feel like it's time. The technologies here, the
Speaker 2: access to information and education. I mean, we have our smartphones.
Speaker 2: We can go to Google and research things that you
Speaker 2: know a couple of seconds. So I feel like the laws,
Speaker 2: while they may fifty years ago, were in place to
Speaker 2: protect consumers because you didn't have readily available information at
Speaker 2: your fingertips.
Speaker 3: Now it's completely different.
Speaker 1: Well, I think that is a very important point, which
Speaker 1: is the information landscape has changed so dramatically, and so
Speaker 1: I think it is fair to look at that again
Speaker 1: and say, wait a minute, do the rules that were
Speaker 1: written And this is complicated, right, Some of this is
Speaker 1: through judicial cases and things like that, so it's it's
Speaker 1: it's a complicated legal landscape. But I think the information
Speaker 1: changes that are out there and the accessibility is really
Speaker 1: a factor we should take into account.
Speaker 3: Yeah. Absolutely.
Speaker 1: Now, of course people have to be careful what their
Speaker 1: information sources are. They have to do some vetting and
Speaker 1: you know, don't just read one thing, look at look
Speaker 1: for more information. We have a website investor dot gov
Speaker 1: that has a lot of information that people can go
Speaker 1: check out as well.
Speaker 2: I tried to do my best on my podcast, like
Speaker 2: if you're joining a Telegra group, a Discord group, or
Speaker 2: some guy and X sends you a chart, just do
Speaker 2: your homework. Double check doesn't mean that that's accurate.
Speaker 1: Yeah, And you know the story is, if you're getting
Speaker 1: someone who tells you to invest in is not charging
Speaker 1: you anything for giving you advice, You've got to ask
Speaker 1: where is that person making make is money? Is he
Speaker 1: making it based on you? Or what is the source?
Speaker 1: So always ask those questions. And if you don't get answers,
Speaker 1: or if you get told this is the last day
Speaker 1: that you can invest, you can't take some time to
Speaker 1: think about it. There'll always be something else you can
Speaker 1: invest in.
Speaker 3: Oh for sure.
Speaker 2: Now, speaking of options and investing, I want to talk
Speaker 2: about all coin ETFs. We have a Bitcoin ETF and
Speaker 2: an Ethereal METF in the market spot. Of course, folks
Speaker 2: are wondering about XRP, Salon and other all coins. Recently,
Speaker 2: the SEC approved gray Scales Digital Large Cap Fund, which
Speaker 2: is really great because that's a basket. Tell us about
Speaker 2: the approach and any timeline you can give about these
Speaker 2: other ETFs.
Speaker 1: Yeah, well, we just approved generic listing standards for a
Speaker 1: number of exchanges, which makes it much easier for these
Speaker 1: ETPs to get through the process at the SEC. There
Speaker 1: are multiple processes you have to get through, but this
Speaker 1: really clears the way for that to be much smoother. Sure,
Speaker 1: and I think that's what people have been waiting for
Speaker 1: to get access to some of these other types of ETPs.
Speaker 2: When you're we've had this conversation before, is the process
Speaker 2: still there needs to be a futures markets.
Speaker 1: For it doesn't, And so I commend the people to
Speaker 1: look at the generic listening standards and they can see
Speaker 1: that it's really a new approach.
Speaker 3: That's really great.
Speaker 2: So Okay, that's I completely missed that, even though I
Speaker 2: read that the futures not necessarily need to be there.
Speaker 2: So that's really great news for other all coin projects
Speaker 2: out there that are maybe in the top ten or
Speaker 2: fifteen that are very liquid and people want access through.
Speaker 1: Yeah, I mean, I expect we'll see more of those
Speaker 1: ETPs coming through under the generic standards. And that's not
Speaker 1: the only way that you can get a product through,
Speaker 1: but that's a more streamlined approach.
Speaker 2: I don't know if you can speak to this because
Speaker 2: it's very kind of left field, but the folks at
Speaker 2: rex ospray they use a different type of model.
Speaker 3: I think the nineteen forties Act.
Speaker 1: Yeah, that's the ETF model Exchange traded fund versus exchange
Speaker 1: traded product, which is so exchange traded funds are a
Speaker 1: subset of broader exchange traded products. Exchange traded funds are
Speaker 1: regulated under the nineteen forty Act, and so there's a
Speaker 1: there's a more intense regulatory framework there. Now. Again, I
Speaker 1: really caution people when they're buying any kind of product,
Speaker 1: whether it's an ETF or some other kind of ETP,
Speaker 1: read the disclosure, think about what you're getting, think about
Speaker 1: the risks associated Ask yourself, is this the right product?
Speaker 1: Is it just an interesting product? Do I want to
Speaker 1: watch it for a while before I decide to buy
Speaker 1: it make you know, use use your judgment, think about
Speaker 1: it before you buy products.
Speaker 2: A lot of folks are chomping at the bit waiting
Speaker 2: for staking in the Etherorem's body. TF would liquid staking
Speaker 2: clarity provided by the SEC. Can we anticipate it and approval?
Speaker 1: Well, Again, the way the process works is people have
Speaker 1: to come in and ask, so, if you know, they
Speaker 1: have to make decision about whether they want to have
Speaker 1: a staking aspect to their product, and then they come
Speaker 1: in and ask and we work with them around disclosures
Speaker 1: and things like that.
Speaker 2: I don't know if you can speak to this because
Speaker 2: it gets a bit into the weeds. But does it
Speaker 2: make sense to add staking to the existing ets or
Speaker 2: create new ets podyts Let's say Etherorem as an example,
Speaker 2: as a separate product, and once again that might be
Speaker 2: outside the SEC's pew.
Speaker 1: So your question is really on whether we need to
Speaker 1: have change the existing products or come in and create
Speaker 1: a new one. I mean, I think people probably will
Speaker 1: do both, you know. I think staking is something that
Speaker 1: people have talked about as being a feature they want
Speaker 1: to be able to have, and so I suspect that
Speaker 1: some existing funds may decide to products may decide to
Speaker 1: include that, and I expect there'll be new products. It's
Speaker 1: not really up to the s I think again, it's
Speaker 1: really important to emphasize that the market decides what products
Speaker 1: are available. People can decide whether they like them or not.
Speaker 1: They can decide whether the fees are high enough or not.
Speaker 1: Our role really on a lot of these things is
Speaker 1: just to work with them on process and disclosure and
Speaker 1: things like that. And I encourage that the sponsors that
Speaker 1: come in that are working with us to listen to
Speaker 1: the to the to work with the staff, and listen
Speaker 1: to the staff's feedback on disclosures, because it no one
Speaker 1: is better off if the investor buying the product doesn't
Speaker 1: understand what she's getting. So we want to get these
Speaker 1: disclosures right. You know, I really do urge people to
Speaker 1: engage in good faith on that process.
Speaker 2: Let's talk a bit about the disclosure aspect, because I've
Speaker 2: heard this over the years.
Speaker 3: I get it, but.
Speaker 2: You know, it goes back to maybe like the Ripple case,
Speaker 2: where secondary market sales were will not a security.
Speaker 3: How do you I don't know.
Speaker 2: I'm trying to figure out how that all works. Is
Speaker 2: it the exchange you still have to give a disclosure
Speaker 2: that you sign up coinbase and you get a disclosure
Speaker 2: for each of these assets, or a general disclosure that
Speaker 2: you're entering the crypto field. Here are some things you
Speaker 2: need to know.
Speaker 1: Well, I mean, my comments around disclosures really went to
Speaker 1: ETPs because there are a lot of exchange traded products
Speaker 1: out there, and you know, you have to do your
Speaker 1: research when you're buying, whether it's crypto related one or not.
Speaker 1: You've got to think about what or work with a
Speaker 1: financial professional to help you decide what works for you.
Speaker 1: With respect to something like a crypto asset, if it's
Speaker 1: not a security and it's not being offered into transactions
Speaker 1: that security is offering, we do not have disclosure rules
Speaker 1: that apply in that instance. Okay, Now, you could have
Speaker 1: an exchange that decided to have a disclosure framework. You
Speaker 1: could have and we've seen this right that there's some organic,
Speaker 1: indisc re led effort to try to get better disclosure
Speaker 1: around tokens, and that doesn't have to be led by
Speaker 1: the government. That can happen in another you know, just organically.
Speaker 3: As I said, Okay, that makes sense. So let's talk
Speaker 3: about the ripple case.
Speaker 1: We can finally talk.
Speaker 3: So commissioner parts.
Speaker 2: You know there's gonna be a lot of the XRP
Speaker 2: army listening here. Why was this case brought in the
Speaker 2: first place? Was it just simply it was the wildwist
Speaker 2: days of the crypto market, the regulators, the industry, No
Speaker 2: one really knew what was going on, just that this
Speaker 2: is a technology we're building, we're innovating.
Speaker 3: Was that the crux of it.
Speaker 1: Well, as I said at the beginning, I can only
Speaker 1: speak for myself, and since I didn't support the case,
Speaker 1: you're probably not asking the right woman. Why we brought
Speaker 1: the case again, it was part of a broader effort
Speaker 1: that I was concerned about, which is using enforcement to
Speaker 1: try to write rules in a pretty difficult landscape. And
Speaker 1: so what I think would have made more sense is
Speaker 1: to think about how different projects were going about offering
Speaker 1: their tokens and trying to get to a world where
Speaker 1: we did end up with better disclosure, but also where
Speaker 1: folks had the choice of whether they wanted to participate
Speaker 1: in these markets or not.
Speaker 3: Sure.
Speaker 2: What did you think about Judge Taurus's ruling secondary market
Speaker 2: sales are not securities? But she also said, like certain
Speaker 2: institutional activities that Ripple did were considered securities. Do you
Speaker 2: think that's going to be eliminated so to speak, because
Speaker 2: of the Clarity Act and things that are being put
Speaker 2: out by the SEC.
Speaker 1: I mean, her ruling was pretty nuanced, So I think
Speaker 1: from a lawyer's perspective, you have to look at the
Speaker 1: nuance of that ruling. But I think that the point
Speaker 1: that that case really underscores is that you can have
Speaker 1: a token that is not itself a security, but is
Speaker 1: offered in a transaction that is a securities offering, and
Speaker 1: so thinking about how that applies. I think that's really
Speaker 1: caused Congress and us at the SEC and others to
Speaker 1: think about what kind of rules make sense here. Congress,
Speaker 1: as you said, has or is you alluded to, has
Speaker 1: the opportunity now to write a new framework, sure, and
Speaker 1: so thinking about what kind of framework makes sense It
Speaker 1: will definitely be done in light of the cases such
Speaker 1: as Ripple and other cases.
Speaker 2: So, Commissioner Purse, you mean the oranges in my house
Speaker 2: right now the supermarket are not securities because.
Speaker 1: Of how I'm going to say, they're not securities, but
Speaker 1: you could still figure out a way to sell them
Speaker 1: in a transaction that is the securities transaction.
Speaker 2: Right, maybe I can tokenize it packages and say you
Speaker 2: get ten percent return this year, right, all.
Speaker 3: Based on the packaging.
Speaker 2: So do you believe Do you think the how we
Speaker 2: test gets updated or there's a new test for digital.
Speaker 1: Assets, Well, we're we're watching in real time as law
Speaker 1: is being developed, and what that looks like we don't
Speaker 1: know yet. I have long thought that the how we
Speaker 1: test it serves a very important purpose. Right. You need
Speaker 1: to pull in these schemes that would not otherwise fit
Speaker 1: within the securities definition. Right, something where someone is saying
Speaker 1: to you give me your money, will you don't have
Speaker 1: to do any work, just I'll do the work and
Speaker 1: you'll get a return on the work that I do.
Speaker 1: That is something the securities laws should cover, and so
Speaker 1: trying to figure that out is important. But the scenarios
Speaker 1: that then get put into the how we framework, reasonable
Speaker 1: minds can differ on which scenarios should be shoved in there.
Speaker 1: And I think one of the reasons I've struggled in
Speaker 1: the area applying how we in the area of crypto
Speaker 1: is because it really is not like anything that we've
Speaker 1: seen before, and so thinking about what makes makes sense.
Speaker 1: It's nice to be able to have this opportunity to
Speaker 1: do regulation now at the SEC instead of trying to
Speaker 1: do this through enforcement, and then to work with Congress
Speaker 1: on trying to come up with longer term legislative answers
Speaker 1: because we can really think about what does make sense
Speaker 1: instead of trying to analogize to other types of things
Speaker 1: that maybe are not really that comparable.
Speaker 2: Right, yeah, it makes sense. So again, excuse my ignorance
Speaker 2: on this. Is it the Congress passes the Clarity Act
Speaker 2: and then the how we test is updated by the
Speaker 2: courts or the SEC.
Speaker 1: So we don't First of all, the Clarity Act has
Speaker 1: passed the House, the Senate is working on its version.
Speaker 1: We don't know what the what the end result will
Speaker 1: look like. We don't so we don't know yet how
Speaker 1: this will work. But typically what happens with the legislation
Speaker 1: is that Congress says, here's here's the statutory framework, and
Speaker 1: now you agencies, whether it's SEC or CFTC or a
Speaker 1: combination of the two, go right the rules to implement
Speaker 1: the legislative framework, so that whole process can take a
Speaker 1: little while. Then what happens is you might over time
Speaker 1: have enforcement actions from the SEC or CFTC, or you
Speaker 1: might have you could have a challenge to the rules, right,
Speaker 1: and so through those kinds of cases, typically it's through
Speaker 1: enforcement cases. The case law builds over time, and so
Speaker 1: it can help elucidate the framework.
Speaker 2: What are your thoughts on the Clarity Act and the
Speaker 2: current status it's currently in the Senate? Obviously, do you
Speaker 2: anticipate it's going to get passed and are.
Speaker 1: You okay, I'm not going to predict what happens with legislation,
Speaker 1: but I am eager to see what comes out of Congress.
Speaker 1: I think it's been helpful to have the Genius Act
Speaker 1: for stable coins, and certainly we'll take whatever directives we
Speaker 1: get from Congress on the market structure side of things.
Speaker 1: But I think it's important to emphasize that, as the
Speaker 1: President's Working Group made clear, we and the CFTC have
Speaker 1: authority already to do a lot of work. So there's
Speaker 1: certain things that are not covered by existing statutory authority.
Speaker 1: There's no regulator of spot crypto trading platforms, for example,
Speaker 1: but there's a lot that we can do under the
Speaker 1: authority we have, and that's really what we're trying to
Speaker 1: do now in the lead up to whatever the legislative
Speaker 1: efforts are well.
Speaker 2: I hope Q four. I just spoke to Congressman Tom Emory.
Speaker 2: He's optimistic. We get it done Q four. And it's
Speaker 2: a you know, we end the year, have a great
Speaker 2: coach Christmas.
Speaker 1: Yeah, and then it well, everyone else will and the
Speaker 1: agencies will be hard at work writing the rules to
Speaker 1: implement the legislation. So we won't waste any time. We'll
Speaker 1: get right to work.
Speaker 3: So you know you mentioned the CFDC.
Speaker 2: They have the Crypto Sprint acting chair, Caroline fam He's
Speaker 2: been doing a great job. How have you guys been
Speaker 2: oberating and working together? Are you're meeting regularly and things
Speaker 2: like that?
Speaker 1: Yeah, we meet regularly. The staff meets regularly. We're having
Speaker 1: a big meeting next week actually on Monday, and that
Speaker 1: will be a joint SEC CFTC roundtable to discuss issues.
Speaker 1: This is not just crypto. I mean, I think it's
Speaker 1: important to note that a lot of the work that
Speaker 1: we do that's not crypto related relates to the work
Speaker 1: that the CFTC does, and so we'll be talking about
Speaker 1: a lot of those issues. It should be a very interesting,
Speaker 1: interesting day of discussions.
Speaker 3: That's great. Great to hear the agency.
Speaker 1: And that's what everyone can tune in. That's going to
Speaker 1: be a public, perfect event.
Speaker 3: That's awesome.
Speaker 2: I want to talk about tokenization in twenty four to
Speaker 2: seven markets commission on PERST because Brave.
Speaker 3: New World almost.
Speaker 2: I don't know if I'm going to be up three
Speaker 2: am drinking coffee trying to trade markets, but maybe I'll
Speaker 2: have an AI agent doing that for.
Speaker 1: Well, maybe you know, your counterparts in Asia might be
Speaker 1: trading overnight. So it's it's definitely something that could be
Speaker 1: interesting to foreign to foreign investors.
Speaker 2: So what are your thoughts on kind of the tokenization
Speaker 2: race happening? Black Rock and all the Wall Street firms
Speaker 2: not to mention crypto native companies, exchanges like coinbased cracking,
Speaker 2: launching tokenized stocks. You know, Larry Fink said tokenization is
Speaker 2: the future of finance.
Speaker 3: Do you believe that?
Speaker 2: And do you see by maybe twenty thirty we are
Speaker 2: in a full twenty four seven market.
Speaker 1: Well, I think there's there already is twenty four to
Speaker 1: seven trading, and I think there's a lot of interest
Speaker 1: in that, So I expect that that will continue. Although
Speaker 1: you may see it differ for different types of securities
Speaker 1: because there may be more concentrated liquidity during some times
Speaker 1: of day for some securities versus others. Sure whether or
Speaker 1: not tokenization is the future. I mean, as a regulator,
Speaker 1: I try to stay out of those kinds of prediction games.
Speaker 1: But I think there's been a real as you as
Speaker 1: you said, there's been a real interest not only from
Speaker 1: crypto native firms, but from more of the traditional financial firms.
Speaker 1: And that interest I think was somewhat. I was expecting it,
Speaker 1: but I wasn't expecting the level of interest that we got,
Speaker 1: and it really was a reaction to the new regulatory
Speaker 1: openness at the SEC People said, hey, we've been wanting
Speaker 1: to try tokenizing regular securities, and people have different ideas
Speaker 1: about how to go about doing that. And we're working
Speaker 1: with people too, and we encourage people to come talk
Speaker 1: to us before they start tokenizing, just to work with
Speaker 1: us to see what exemptions they might need and how
Speaker 1: to go about doing this in a way that's protective
Speaker 1: of investors. I think, again, I'm going to bang the
Speaker 1: disclosure drum here, which is that if you are selling
Speaker 1: something that you're categorizing as a tokenized security, you need
Speaker 1: to be clear with people about what kind of security
Speaker 1: it is, what kinds of rights they have, what kind
Speaker 1: of risks they face that are maybe different from the
Speaker 1: risk of the security that you're trying to tokenize.
Speaker 2: So is it needless to say that if I'm tokenizing
Speaker 2: a stock, it's still a security because originally it was
Speaker 2: a security. If I'm tokenizing goal a commodity, it's still
Speaker 2: a commodity. But if it's offered up in a different way,
Speaker 2: then it could become.
Speaker 1: A security, and it could become a different kind. Even
Speaker 1: with a security that you tokenize, it could become a
Speaker 1: different kind of security depending on how you tokenize it.
Speaker 1: So if you take it and you transform it somehow,
Speaker 1: it might actually turn into a derivative, and there are
Speaker 1: different rules around how those can trade. So people really
Speaker 1: need to tread carefully here.
Speaker 2: So how are you and the folks at the SEC
Speaker 2: preparing for all this given that twenty four to seven markets,
Speaker 2: but also these firms can open up these assets to
Speaker 2: global investors. So because of the wallets set up in
Speaker 2: the nature of smartphones, now, how are you preparing to
Speaker 2: handle all that?
Speaker 1: There are a lot of difficult questions and we're working
Speaker 1: with people, which is again why we encourage people to
Speaker 1: come talk to us and think about you know, you
Speaker 1: can sell something abroad, but if it's flowing back into
Speaker 1: the US, there could be potential securities law laws implications
Speaker 1: here in the US, even though you initially sold it
Speaker 1: outside the US. So you have to think about all
Speaker 1: these kinds of things. And I really encourage people to
Speaker 1: do this carefully. If we do it right, I think
Speaker 1: this could be a wonderful chance to see whether this
Speaker 1: is where the markets want to go. But if we
Speaker 1: do it wrong and a lot of investors get hurt
Speaker 1: because they didn't get the thing they thought they were buying,
Speaker 1: then we could destroy the market before it has a
Speaker 1: chance to grow.
Speaker 2: Oh.
Speaker 3: Absolutely.
Speaker 2: You know. One of the things that are being discussed
Speaker 2: is AI agents being able to use crypto assets like
Speaker 2: stable coins to settle transactions. That's fine, but what happens
Speaker 2: when an AI agent creates its own blockchain in its
Speaker 2: own token. I don't know if we're going too far
Speaker 2: ahead here, but what are your thoughts on that?
Speaker 3: Yeah?
Speaker 1: I mean, I think there are going to be a
Speaker 1: lot of fun questions for young lawyers to grapple with,
Speaker 1: and some of those will be uh will be questions
Speaker 1: that directly are relevant to the sec But I think
Speaker 1: people again need to be careful they and financial institutions
Speaker 1: that are trying to use these tools. I think it's
Speaker 1: wonderful because I think there are chances to make the
Speaker 1: financial markets more accessible to a larger group of people
Speaker 1: by having tools that make it cheaper to offer financial
Speaker 1: services to people. So we encourage people to experiment with technology,
Speaker 1: but also to think about what the implications are and
Speaker 1: and to you know, be mindful of the risks of
Speaker 1: what they're creating.
Speaker 2: Yeah, that's a conversation I feel I'm going to have
Speaker 2: with you for the next whileever long you're at the
Speaker 2: SEC because I'm also exploring like AI agents and how
Speaker 2: I can use them to help offer services to my
Speaker 2: listeners and viewers. I don't want to create a token necessarily,
Speaker 2: but the possibilities there. What if this, and again you
Speaker 2: have a GI and all these things they get so
Speaker 2: smart and sophisticated.
Speaker 3: The collective IQ is.
Speaker 2: Greater than all of us and the smartest minds in
Speaker 2: the human minds in the world.
Speaker 3: And there.
Speaker 1: Yeah, I mean I am a little bit of a
Speaker 1: human maximalist because as interesting as I think this technology
Speaker 1: is and as amazing as it is, the human being
Speaker 1: is still the most and the human mind is really unrivaled,
Speaker 1: and so I will always will always believe that you
Speaker 1: need somewhere to have a human in the loop. Human
Speaker 1: jobs aren't going to go away because humans can bring
Speaker 1: something that no machine can ever can offer bring, or
Speaker 1: no AI agent can of our bring.
Speaker 2: So on that note, are you and the folks of
Speaker 2: the SEC and the staff looking to leverage AI to
Speaker 2: do your jobs, not replace you, but to make things
Speaker 2: more efficient faster. You can send it out to go
Speaker 2: review this token project, come back with the research, and
Speaker 2: then human takes over.
Speaker 3: Yeah.
Speaker 1: Absolutely. In fact, I was talking with someone about that yesterday,
Speaker 1: about the ability of AI to do some of the
Speaker 1: tasks that that we SEC staff has done in the past.
Speaker 1: It can enable us to review more disclosures, for example,
Speaker 1: and then have the the ones that are have something
Speaker 1: unique or unusual filtered up for for human level review.
Speaker 1: We do exams of firms that are registered with US
Speaker 1: Investment Advisors, broker dealers s ROS. I think that that
Speaker 1: AI can be very helpful in making us make better
Speaker 1: use of our enforcement personnel UH and and again get
Speaker 1: better coverage. So I'm quite excited about the possibility of
Speaker 1: of AI to make us a better, a better regulator,
Speaker 1: and and maybe even help us with consistency as as
Speaker 1: a regulator, which is something that anytime you have an
Speaker 1: examination program or a disclosure review program you worry about.
Speaker 1: You want to have consistency so that like registrants or
Speaker 1: like regulated entities are treated similarly. And so I expect
Speaker 1: AI to be helpful there as well.
Speaker 2: And going back to what we were talking about twenty
Speaker 2: four to seven markets, maybe you have these AI agents
Speaker 2: running twenty four to seven while you're sleeping and everybody
Speaker 2: the staff is sleeping, they can be out there monitoring
Speaker 2: the markets.
Speaker 1: Sure, as long as it's as long as it's public
Speaker 1: information I don't want to create. I think this is
Speaker 1: one of the things we do have to worry about too.
Speaker 1: These new technologies have made it much easier for us
Speaker 1: to exercise very comprehensive surveillance, but we also have to
Speaker 1: remember that there are some constitutional principles here about people's
Speaker 1: ability to live their lives without having government watch their
Speaker 1: every move. Now, if someone is if there's a reason
Speaker 1: to suspect that someone has done something wrong, then we
Speaker 1: should go in and look at what that person has done.
Speaker 1: But I don't really want to be watching all your trading,
Speaker 1: because I, as a regulator, have I have no right
Speaker 1: to follow you around in the markets and to watch
Speaker 1: everything that you're doing in the markets. You might have
Speaker 1: reasons for doing things that you don't want to have
Speaker 1: have someone else seeing what you're buying and selling, right,
Speaker 1: But then if you did something wrong, then that's the
Speaker 1: point where we go in and we get the information.
Speaker 1: So new technology is great, very helpful for regulators, but
Speaker 1: we have to exercise it responsibly.
Speaker 2: Yeah, well said, And to your point, maybe it's just
Speaker 2: you put these triggers that if something looks unusual, then
Speaker 2: it activates. It's not constantly moditoring like yeah, big Brother
Speaker 2: or something exactly. Yeah, I want to ask you about
Speaker 2: Dat's digital acid treasury companies. We've seen an explosion in
Speaker 2: this This trend seems to be growing and it's happening
Speaker 2: around the globe. But there seems to be a bit
Speaker 2: of a bubble forming here from my perspective, but every
Speaker 2: market experience bubbles. What are your thoughts on these companies
Speaker 2: adding crypto assets that are balance.
Speaker 1: Sheet Again, it's not my role as a regulator to
Speaker 1: tell companies what they should or shouldn't do. Sure, except
Speaker 1: that when it comes to disclosing what they're doing, that
Speaker 1: is in our wheelhouse. And if these are public companies
Speaker 1: and they're they're this is big, this is this is
Speaker 1: something they're doing, they have to be very clear with
Speaker 1: in their disclosures about what the risks are associated with
Speaker 1: what they're doing, what the you know, they can tell
Speaker 1: people what they're why they're doing it, what the expected
Speaker 1: benefits are, but they also really do need to be
Speaker 1: clear about those risks. And so that's what I'm really
Speaker 1: focused on is is when there's any trend like this,
Speaker 1: people can get caught up in the excitement. But there
Speaker 1: are still securities laws that do tell you have to
Speaker 1: be very serious when you think through the risks and
Speaker 1: how you present them to investors.
Speaker 2: Does it make sense, but the sec to put out
Speaker 2: guidance on this or the existing laws covers I.
Speaker 1: Mean, the intersting laws cover it. We have disclosure review
Speaker 1: people who work with registaurants, whether they're doing a DAT
Speaker 1: or some other kind of company, and so if people
Speaker 1: have questions, they can reach out to our staff. Our
Speaker 1: staff will engage with them on thinking about how to
Speaker 1: present these risks and things like that. So people can
Speaker 1: can engage, but maybe guidance will be necessary because, as
Speaker 1: you note, it is it is quite a trend.
Speaker 2: Now, yeah, everybody in their grandma is trying to do this.
Speaker 2: If you're a public and trade a company, and do
Speaker 2: you have these funds out there looking hunting for these companies?
Speaker 3: Hey do this stock arbitrage? YadA YadA.
Speaker 1: But you know, and when I see things like that,
Speaker 1: I also ask is there is there something that we're
Speaker 1: doing as a regulator that people are doing these kinds
Speaker 1: of things in public companies instead of doing it in
Speaker 1: a fund for example. And so those are questions to
Speaker 1: ask because you know, one of the questions you raised
Speaker 1: earlier around staking in exchange traded products, that's something that
Speaker 1: maybe companies are doing because they have more flexibility to
Speaker 1: do it than they do in the exchange traded products.
Speaker 1: So then you have to ask, is there regulatory arbitrage
Speaker 1: going on here? Yeah? I'm not weighing in on that
Speaker 1: question here. I'm just saying that it's something that we
Speaker 1: should always be thinking about.
Speaker 2: I've interviewed a few folks from the DATS and yes,
Speaker 2: some of them have made the case, hey why put
Speaker 2: your money in this body? TF bring it to the
Speaker 2: dat get the stock these staking rewards that reinvested, or
Speaker 2: you get a dividend. They made that case, but I
Speaker 2: think as soon as the SEC approves staking and ets,
Speaker 2: you know, they'll lose a bit of that thunder.
Speaker 1: I'm not weighing in. We'll see what happens.
Speaker 2: You know. Go back to the bubble item. I want
Speaker 2: to get your perspective on this, and again, every market.
Speaker 2: I want to preface this because then I wanted to
Speaker 2: seem like it's crypto. We saw a real estate bubble,
Speaker 2: we saw a dot com boom bubble. I believe in
Speaker 2: the frame mark. But does a regulator play a part
Speaker 2: in saying, hey, there's some red flags here we need
Speaker 2: to step into. I know that's a fine line.
Speaker 1: Well, it's just not a job that Congress gave us.
Speaker 1: They did not tell us to tell people what to
Speaker 1: invest in. They told us go help people figure out
Speaker 1: what they're buying by working with public companies and with
Speaker 1: investment companies. So exchange traded funds and mutual funds on
Speaker 1: their disclosure, and then go regulate the financial professionals that
Speaker 1: help people invest in these things. Sure, but I think
Speaker 1: there is a very important lesson that people time and
Speaker 1: again forget, which is you know, making money comes with risks, right,
Speaker 1: and so you can't just assume that the market is
Speaker 1: always going to go up. You can't always assume that
Speaker 1: anything you buy is going to go up. You can't
Speaker 1: assume that the money you put into something will come out.
Speaker 1: And so you have to think about your own financial
Speaker 1: portfolio in terms of what your risk tolerance is. When
Speaker 1: are you going to need that money? Are you trying
Speaker 1: to buy a house next month? Then you know that's
Speaker 1: different than if you're trying to invest for if you're
Speaker 1: trying to invest over a long period of time for retirement.
Speaker 1: So you have to think about that. You've got to
Speaker 1: think about what the mix of investments that you have are,
Speaker 1: and you should you should be very careful about those
Speaker 1: kinds of things because people can get hurt, and they
Speaker 1: have historically gotten hurt when they get caught up in
Speaker 1: the exuberance about things always seem to be going up.
Speaker 1: And you know, I think all of us have learned
Speaker 1: that lesson somehow, some way, and those lessons stick, but
Speaker 1: they can be very painful. And so if you want
Speaker 1: to avoid that, learn from lessons that others have experienced
Speaker 1: and don't go through it yourself and be careful about
Speaker 1: how you manage your finances.
Speaker 2: Yeah, you know, it's almost like human beings though we
Speaker 2: can't help ourselves.
Speaker 3: We're speculative beings.
Speaker 1: We are right and and there's nothing inherently wrong with it.
Speaker 1: It's just that you've got to know your own limits
Speaker 1: and your risk level, and you have to be a
Speaker 1: little bit you know, realistic. I have to laugh because
Speaker 1: I was telling my young niece at the time, she
Speaker 1: was quite young, five, and I was telling her about
Speaker 1: housing bubbles, and she said she thought it was very funny.
Speaker 1: She just thought that that way of describing it was
Speaker 1: very funny, you know. And she said, well, who gets
Speaker 1: caught in housing bubbles ant Hester And I said, well,
Speaker 1: I do. I actually bought at the top of the
Speaker 1: market and and I paid the price for that, right,
Speaker 1: And so I think people, you know, they they really
Speaker 1: have to have to go into this soberly.
Speaker 2: Absolutely. I always tell people, also, look, do your best
Speaker 2: to avoid leverage and have a long term view because
Speaker 2: leverage also, you know, that's one of the big things
Speaker 2: people try to get their fast buck.
Speaker 1: I mean, people need to be very careful of that.
Speaker 1: And I think we saw that in the in the
Speaker 1: crypto you know years of the past right where people
Speaker 1: really got caught by leverage and the and you know,
Speaker 1: there are other basic things like know who your counter
Speaker 1: party is, Understand what the counterparty is doing with the
Speaker 1: assets you entrust to that person. What happens if if
Speaker 1: that person that you're interacting with goes bankrupt? Do you
Speaker 1: get your stuff back? Does someone else get it? Do
Speaker 1: the creditors take it? And so these are questions that
Speaker 1: regular people who are making the decision to invest should ask,
Speaker 1: their questions that we as regulators have to ask. We're
Speaker 1: trying to come up with a framework that does protect people,
Speaker 1: but protections really differ depending on what market you're in,
Speaker 1: what assets you're buying, and so people need to be
Speaker 1: quite careful about understanding that. Don't only think think about
Speaker 1: what happens on the good days, think about what happens
Speaker 1: on the bad days.
Speaker 3: For sure.
Speaker 2: I forgot to ask you about the Genius Act and
Speaker 2: your thoughts on that passing and the implications on the
Speaker 2: stable coin market. We've heard banks want to launch their
Speaker 2: own stable coins. Is the SEC involved in any part
Speaker 2: of that or is it specifically like the yield bearing
Speaker 2: aspect of it.
Speaker 1: Well, the SEC is involved in the sense that I
Speaker 1: think a lot of the entities we regulate will want
Speaker 1: to make stable coins available for their customers and so
Speaker 1: thinking about how they can do that in a way
Speaker 1: that's compliant. Tokenized money market funds or something that have
Speaker 1: been around for some time. They're not stable coins, but
Speaker 1: that is an area that we do regulate, and we've
Speaker 1: been working with people who have tried to tokenize money
Speaker 1: market funds now for quite a few years, and so
Speaker 1: I expect more interest in that area. People can maybe
Speaker 1: use those for collateral and things like that, and then
Speaker 1: I expect that any kind of you know, when there's
Speaker 1: a yield bearing component to it, people ought to come
Speaker 1: in and think about whether it's a security or not.
Speaker 1: That starts to look a lot more like a security.
Speaker 1: We did put out guidance on stable coins to say,
Speaker 1: you know, the non yield bearing type of the type
Speaker 1: that are at issue and the Genius Act they're not
Speaker 1: within our remit. That's what the Genius Act said that
Speaker 1: as well. So those are banking those are banking regulatory issues.
Speaker 1: But there will be a lot of interaction, I think
Speaker 1: between stable coins and the markets that we regulate.
Speaker 2: Question just came to mind, and I don't know this
Speaker 2: in walls the sec or not, but I love to
Speaker 2: get your thoughts.
Speaker 3: Would these big trad fi institutions coming in bank stock exchanges.
Speaker 2: There's obviously a competition happening with the crypto native startups,
Speaker 2: and how do you find that balance or it's the
Speaker 2: free market and whoever wins.
Speaker 1: Well, we're definitely getting a lot of input from traditional
Speaker 1: financial firms that are saying, don't give the crypto native
Speaker 1: firms special treatment, and so I think really the goal
Speaker 1: is to look at what the regulatory impediments are to
Speaker 1: people participating in this area, to think about is there
Speaker 1: a reason for that regulatory impediment or doesn't it make sense,
Speaker 1: Which is why part of the regulatory the crypto regulatory
Speaker 1: project will end up I think, having a larger effect
Speaker 1: on the securities laws. It's not to say we're going
Speaker 1: to rewrite the entire securities law book, but any time
Speaker 1: you have a new technology or a new something new
Speaker 1: like tokenizing securities, you start to ask questions about does
Speaker 1: the rule we have in place make sense? Should we
Speaker 1: move to a more technologically neutral rule, should we move
Speaker 1: to a more principles based rule. Is this rule simply
Speaker 1: on the books because no one bothered to take it
Speaker 1: off the books, and it doesn't even make sense for
Speaker 1: traditional financial firms. And so we're definitely trying to work
Speaker 1: through those issues in a way that's public, that allows
Speaker 1: everyone to weigh in, and that doesn't give anyone special treatment,
Speaker 1: but also allows people to experiment. And sometimes in order
Speaker 1: to experiment, you're going to need certain exemptions, and so
Speaker 1: we have to figure out how to craft those exemptions
Speaker 1: in a way that makes sense.
Speaker 3: It's fascinating.
Speaker 2: I'm a macro viewer of human behavior and technology, and
Speaker 2: I'm curious to see how this all plays out. As
Speaker 2: you have like these goliads coming in, but these cryptonative
Speaker 2: startups have head start.
Speaker 1: Well, but I think, you know, I think it will
Speaker 1: be interesting to see how the competitive landscape shakes out.
Speaker 3: Sure.
Speaker 1: One thing that has been fun for me to see
Speaker 1: is that over the years, you see new entrants come in,
Speaker 1: you see existing entrance, existing incumbents go away. That's a healthy,
Speaker 1: dynamic competitive environment that we want to build. Now, I
Speaker 1: actually think there's been less of that dynamism in the
Speaker 1: financial industry than is ideal because I think the regulatory
Speaker 1: barriers are higher than they have needed to be, and
Speaker 1: so it's really trying to get that balance right. We
Speaker 1: don't want to put our thumb on the scale in
Speaker 1: terms in favor of any competitor, whether incumbent or new entrant,
Speaker 1: but we want to make sure that everyone can go
Speaker 1: in and really fight it out there competitively, and that
Speaker 1: it's not our rules that are preventing people from doing that.
Speaker 1: So it's an exciting time when a set of new
Speaker 1: of people who weren't normally in this sphere come in
Speaker 1: and say, hey, we might have a better way of
Speaker 1: doing things, and then we want to let them come
Speaker 1: in and show us show the market. Is it really
Speaker 1: better or does the market prefer the traditional way of
Speaker 1: doing things. That's up to the market to decide.
Speaker 2: Yeah, well said you know something recently Sandy call Franklin
Speaker 2: Templeton said which I thought was profound, that we're moving
Speaker 2: away from the account based setup, total wallet setup. And
Speaker 2: then you know, it's in line what we were talking
Speaker 2: about with this race. I don't necessarily want to go
Speaker 2: through JP Morgan anymore. If I can have my all
Speaker 2: in one on chain, all in one super app has
Speaker 2: my digital identity my crypto wallet, I could stay pay
Speaker 2: with stable coins and all that biometrically locked in, cryptographic
Speaker 2: and all that. You know, it seems like that's the
Speaker 2: direction to Pucke is heading in. Obviously, it's going to
Speaker 2: take time for the masses to get on board. But
Speaker 2: I'm curious is the sec looking at it from that
Speaker 2: perspective as well? People are going to go more wallet
Speaker 2: base and move away from the traditional institutions.
Speaker 1: Yeah, it's possible. I mean, we have a very intermediary
Speaker 1: centric system now. No people can buy financial products and
Speaker 1: they can buy securities without going through inter mediaries, but
Speaker 1: it's typically the way that it's done. So that will
Speaker 1: be quite a switch if we end up in a
Speaker 1: world like that. But I think we have to be
Speaker 1: flexible and try mean, the goal should be to make
Speaker 1: the regulatory framework work for how people want to live
Speaker 1: sure and so that's if investors. If that is the future,
Speaker 1: then investors want where everything is in one place. That's
Speaker 1: what we should work on. We're thinking of that some
Speaker 1: in connection with this sort of super app idea, which
Speaker 1: is that you should be able to you know, we
Speaker 1: shouldn't add requirements to have to get lots of new licenses.
Speaker 1: You should be able to access things through your broker
Speaker 1: dealer if that's where you want to access things.
Speaker 3: Yeah.
Speaker 2: Yeah, it's fascinating. We'll see how it all plays out.
Speaker 2: I'm curious what twenty thirty looks like and what all
Speaker 2: these technologies posts, crypto legislation being played, being in place,
Speaker 2: and the innovation that comes from it. Okay, final question
Speaker 2: here is something fun, Commissioner Perst.
Speaker 3: If you weren't working at the SEC, what do you think.
Speaker 2: Your ideal day job might be or what would you
Speaker 2: be doing?
Speaker 1: Well, I think I'm going to have to figure that
Speaker 1: out relatively soon, So I guess I better. If I
Speaker 1: could do anything and I could make money doing it,
Speaker 1: I'd probably be a baker. But I'm not that great
Speaker 1: of a baker. I just enjoy I enjoy baking bread
Speaker 1: and cookies and cakes.
Speaker 3: And you know it's funny. I'll tell you a funny story.
Speaker 2: My seven year old daughter all of a sudden loves
Speaker 2: Martha Stewart and watching her make cupcakes and so forth.
Speaker 2: And she's been into that, so I now know how
Speaker 2: to make some.
Speaker 1: See that's good because you'll be able to get all
Speaker 1: the benefits of her baking.
Speaker 2: Yeah, she loves it now. So it's fascinating how that.
Speaker 2: It's funny how that works out. Commissioner purs always a pleasure.
Speaker 2: Thank you so much for taking the time and like
Speaker 2: I said, I want to give your flowers. Thank you
Speaker 2: for all the thought, leadership and the great work you've
Speaker 2: done over the years.
Speaker 3: Thank you, Thanks Tony.
Speaker 1: I've enjoyed our conversations over the years.