Hester M. Peirce, a member of the Securities and Exchange Commission, is worried that the regulator is moving too slowly for the crypto ecosystem.

Addressing fellow regulators at the Securities Enforcement Forum in Palo Alto, California (the heart of Silicon Valley) on Monday, Peirce said that one year ago she was concerned that the SEC “as one of [the token market’s] potential regulators, would stifle its growth.”

She wryly added: “I will admit today that I was very wrong, not about whether the SEC would stifle the industry’s growth—it has—but in how it would do it.”

Rather than being heavyhanded in enforcing the rules as she feared, the agency has instead been too sluggish to clarify or update them, Peirce explained:

I worried that hasty regulation would smother the industry in its infancy. My concerns did not become reality. The enforcement actions we have taken to date in the crypto space have—for the most part—exhibited appropriate restraint. On the regulatory side, “hasty” is not the word I would use to describe the SEC’s pace. It is not the SEC’s overzealous action that has stifled the crypto industry, but its unwillingness to take meaningful action at all.

Her primary concern is that while the SEC has done a great deal to reach out to fast-moving startups, the tools it uses to assess when regulations apply – including the Howey test for determining whether something meets the definition of a security – are still dangerously out-of-date.

To be sure, Peirce credited the SEC for being open and forward-thinking about communicating with startups. The SEC’s FinHub network has been leading in startup outreach and most recently held a meetup in Denver where blockchain companies came to speak directly with regulators.

Unfortunately, she said, things aren’t moving fast enough on the clarity front:

The SEC has yet to provide guidance to the public or FINRA on any of the core questions. The result is that many would-be brokers and trading platforms are stuck in a frustrating waiting mode; they are unable to get clear answers to questions about how they may proceed in this market.

While emphasizing that she was proud of the work done by the SEC and its attendant securities markets, Peirce warned that the current inertia threatens to undermine those successes, concluding:

“The U.S. securities markets have historically been the envy of the world; I do not want heel-dragging by the SEC in crypto to mar that well-deserved reputation.”

Hester Peirce image via Christine Kim for CoinDesk.