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Who Is Mark Uyeda? The Crypto Moderate SEC Commissioner Sworn In For a Second Term

Last Updated January 7, 2024 9:12 AM
Josh Adams
Last Updated January 7, 2024 9:12 AM
Key Takeaways
  • Mark Uyeda, nominated to the SEC by President Biden, has been a nuanced voice when it comes to crypto.
  • In his first term at the SEC, Uyeda argued for listening to crypto investors and industry members.
  • He has also criticized the SEC for not providing clear rules and guidance to the digital assets sector.

United States Securities and Exchange Commission (SEC) Commissioner Mark T. Uyeda was sworn in  on December 28th. He begins his second term leading the agency tasked with regulating US financial markets. 

Uyeda has been a moderate voice on crypto assets during his tenure, encouraging dialogue with the industry. His reappointment may well provide crucial votes in future actions by the SEC.

Mark Uyeda: A Nuanced View on Crypto Regulation

Uyeda was first nominated to the SEC by President Joe Biden in 2022—despite being a Republican. He was confirmed by the Senate for a term expiring in 2023. Biden renominated him last June and confirmed for another five-year term in December.

The SEC Chair and commissioners lead the agency, setting its direction and administering securities laws. Together, they vote on regulatory policies and actions for the United States. However, they don’t always agree.

While SEC Chair Gary Gensler has aggressively pursued expansive crypto regulation and enforcement during his tenure, Uyeda has carved out a more moderate position. 

In a recent response  to Coinbase’s petition for clearer rules for the digital asset sector in the United States, the SEC, in a 3-2 vote, disagreed that current rules were “unworkable”. Mark Uyeda,and Hester Peirce were the two dissenting voices  on the Commission. 

In their view, any rulemaking agenda should include engaging with the public and industry in “open conversations”. In a joint statement, both Uyeda and Peirce said they were “disappointed that the Commission is not hosting these important conversations.” This could be seen as a direct rebuke to Gensler’s modus operandi at the SEC.

Opposed to “Regulation by Enforcement”

In 2022, Uyeda criticized Gensler’s strategy of using litigation to establish crypto regulation. He called it “regulation by enforcement.” In 2023, the SEC brought enforcement actions against three major crypto exchanges—Coinbase , Kraken , and Binance —for allegedly violating securities laws. Additionally, the agency was unsuccessful last year in its attempt to have the XRP cryptocurrency token deemed a security in a court challenge.

In 2022,  Uyeda said : “To date, the commission’s views in this space have been more often expressed through enforcement action. “Regulation through enforcement does not yield the outcomes achievable through a process that involves public comment, because without the benefit of comments from crypto investors and other market participants, the commission is unable to consider their perspectives in developing an appropriate regulatory framework.”

Uyeda: Regulators Should Provide Clear Rules

In his speech last November to an international conference on SEC regulation, Uyeda outlined several areas where he believes the SEC should provide more regulatory clarity instead of primarily using enforcement lawsuits. These included  cryptocurrency definitions, the scope of the securities dealer definition, and off-channel communications by broker-dealers.

On cryptocurrencies, Uyeda noted the lack of formal SEC rule proposals on digital assets. This was despite a flurry of other rulemaking activity. He emphasized the need for clearer jurisdictional guidance, given difficulties applying the Supreme Court’s 1946 “investment contract” Howey test to new technologies like crypto. 

In his speech, he said: “The Commission… can and should provide clarity to market participants, which can occur in the form of rules, interpretations, guidance, and no-action letters.

“This clarity should be provided before resorting to enforcement actions.”

While acknowledging enforcement actions can contribute to building legal precedent, Uyeda said this court-driven process means it could take years to achieve definitive clarity. He believes that a responsible regulator should provide upfront through transparent rulemaking. A view many in the crypto industry fervently agree with.

 

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