US SEC member Peirce warns: L2 chains with centralized sorters may face exchange registration requirements

PANews September 9th news, according to Cryptoslate, the U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce warned that the Layer2 blockchain running a centralized matching engine may face exchange registration requirements, while advocating the protection of true decentralized protocols. In an interview with The Gwart Show, she distinguishes between immutable code on a decentralized network from centralized entities that utilize blockchain transactions. The head of the SEC Cryptocurrency Task Force believes that truly decentralized protocols cannot be owned and can be used by anyone. Layer2 solution solves MEV problems due to centralized transaction sorting and introduces regulatory complexity. Its matching engine deviates from the anti-censorship characteristics of blockchain. Peirce said that the single entity-controlled matchmaking engine is more like an exchange, and operators need to consider relevant requirements if they trade securities, but the SEC wants to avoid forcing decentralized protocol registration. She stressed that protecting smart contracts on fully decentralized Layer1 networks is crucial. Peirce tends to let the community solve the MEV problem first and then regulate the intervention. As traditional securities move to blockchain, she hopes to protect developers, ensure that centralized intermediaries abide by the rules, advocate distinguishing autonomous code from regulated entities, allowing decentralized protocols to enjoy a safe harbor, and centralized Layer2 chains are regulated by traditionally.