What did SEC Commissioner Hester Peirce say about DeFi and open-source code?

SEC Commissioner Hester Peirce said publishing open-source blockchain or DeFi code should generally be considered protected speech under the First Amendment. She argued that developers should not automatically face securities regulations simply because other people use their software.

Why is Hester Peirce’s speech important for crypto developers?

Peirce's comments suggest some SEC officials are becoming more cautious about holding software developers liable for how decentralised protocols are used. This could reduce regulatory uncertainty for developers building blockchain infrastructure and DeFi applications.

Does Hester Peirce believe DeFi developers should be treated like brokers or exchanges?

No. Peirce questioned whether rules designed for traditional financial intermediaries such as brokers, dealers and exchanges should automatically apply to decentralised blockchain networks that operate without central operators.

What is the main legal argument behind Peirce’s position?

Peirce argued that publishing software code is generally a protected form of expression under the First Amendment. Her position is that responsibility for securities law violations should typically fall on people engaging in unlawful activity rather than the developers who created the underlying software.

Does Hester Peirce’s statement mean DeFi is now legal or exempt from SEC oversight?

No. Peirce is one SEC commissioner and her remarks do not change existing laws or regulations. DeFi projects may still face regulatory scrutiny depending on how they operate and whether securities laws apply to specific activities.

How does this fit into the SEC’s current approach to crypto regulation?

The comments align with a broader shift under SEC Chair Paul Atkins away from what has been described as "regulation by enforcement." The agency's Crypto Task Force is reviewing how securities laws should apply to digital assets, blockchain networks and decentralised systems.

What recent SEC guidance supports Peirce’s view?

SEC staff recently issued guidance suggesting that some websites and software interfaces that simply provide access to decentralised protocols may not meet the traditional definition of a broker. This indicates regulators may be distinguishing between infrastructure providers and financial intermediaries.

What could this mean for DeFi projects and crypto startups?

The comments may encourage developers and investors who were concerned about potential enforcement actions against software creators. However, projects that offer financial services, generate revenue from users or maintain significant control over protocols could still face regulatory challenges.

Image for illustrative purposes only. Not a real photo.

Peirce says DeFi code protected by speech rights

Written by Isaac FrancisPublished Jun 5, 2026, 12:14 AM

US Securities and Exchange Commission Commissioner Hester Peirce said software developers should not face securities obligations simply for publishing open-source blockchain and decentralised finance code.

Speaking at the IC3 Blockchain Camp at Princeton University, Peirce said developers who create blockchain tools should not automatically be classified as securities intermediaries because third parties choose to use their software.

“Many blockchain projects involve publishing open-source software, which is generally a protected activity under the First Amendment,”

Said SEC Commissioner Hester Peirce.

Peirce argued that decentralised protocols can operate without traditional financial intermediaries and said responsibility for securities violations should generally rest with those who engage in unlawful conduct rather than the developers who build the underlying infrastructure.

“The SEC’s rulebook is full of intermediaries: brokers, dealers, exchanges, clearinghouses, transfer agents, investment advisers and investment companies,”

Said SEC Commissioner Hester Peirce, adding that regulators should consider whether such rules should apply to blockchain infrastructure itself.

The remarks come as the SEC moves away from what Chair Paul Atkins has described as “regulation by enforcement”, with the agency’s Crypto Task Force reviewing how existing securities laws apply to digital assets and decentralised systems.

The comments also follow recent SEC guidance indicating that some websites and software interfaces providing access to decentralised protocols may not qualify as brokers, while the regulator’s draft strategic plan through 2030 states that blockchain and crypto asset technologies have the potential to transform America’s financial infrastructure.