SEC Commissioner Kara Stein: Blockchain technology is still in its infancy, regulators need to pay close attention

According to CoinDesk, Kara Stein, a member of the U.S. Securities and Exchange Commission (SEC), has issued a warning against the hype surrounding blockchain technology and distributed ledgers.

Speaking at a conference held yesterday at Harvard Law School, Stein discussed extensively the impact of this innovation on the U.S. capital markets, pointing to blockchain as a particular emerging technology that could impact the sector.

In her speech, Stein pointed out that blockchain technology has received increasing attention recently. In addition, she mentioned the relationship between blockchain technology and Bitcoin and listed a series of blockchain technology applications currently being explored, including clearing and settlement, payment processing, and lending transactions.

While Stein acknowledged that these apps could increase trust in the financial system, she also told the audience:

“While I am not advocating for the adoption of blockchain technology, it seems to offer potential. We can envision a world where securities lending, repo and margin trading are all tracked via a transparent and public blockchain.”

Stan goes on to theorize that public ledgers might one day serve government regulators, allowing them to better monitor “systemic risk” in financial markets.

However, Stein cautioned that these ideas are still “in their infancy,” and she believes the technology will have to go through ongoing evaluation by regulators, academia, and capital market participants before it lives up to its hype.

“Can blockchain be used to enhance markets and investor protections? Or is there a way it could be used to monopolize markets or undermine competition? How should this technology be best deployed? Should it be run through public-private partnerships, a bit like the internet?” Stein asked.

She also added that U.S. regulators should keep a close eye on the development of this technology:

“If the market begins to move toward blockchain technology, regulators need to be in a position to lead the way, capitalize on its benefits and respond quickly to its potential weaknesses.”

It is reported that this is the first time that the US federal securities law regulator has expressed its opinion on Bitcoin or blockchain technology. So far, the SEC's participation in industry activities has mainly been enforcement actions against bankrupt startups, such as GAW Miners and Sand Hill Exchange.

Original article: http://www.coindesk.com/sec-commissioner-kara-stein-blockchain-technology/
By Pete Rizzo
Compiled by: Satuoxi
Editor: Satuoxi
Source (translation): Babbitt Information