In remarks at the 13th Annual Conference on Financial Markets Regulation, U.S. Securities & Exchange Commission Commissioner Hester Peirce said regulators should focus first on understanding rapid changes in market structure and investor behaviour before acting, and that the appropriate response may be limited rather than a wave of prescriptive rulemaking. Speaking in her personal capacity, not for the Commission, she argued that expanding retail participation, prediction markets, options activity, active exchange-traded funds, crypto-linked products and technology-driven trading do not by themselves justify intervention. Peirce pointed to sharp growth in trading activity and complexity, including options message volumes rising from 9 billion a day in 2017 to 247 billion a day in 2025, and zero-day-to-expiration options increasing from about 20 percent of options volume in 2022 to 28 percent now, largely driven by retail traders. She said regulators should draw on discussions with market participants, public roundtables and academic research to determine whether any response is needed. The speech also stressed the SEC's statutory limits, noting that the agency cannot pursue fraud without a securities law cause of action and cannot block an ETF from listing if the sponsor complies with the rules, provides proper disclosure and secures an exchange listing. Peirce also noted that commercial prediction markets have grown far more quickly than she expected and said the Office of Information and Regulatory Affairs dashboard shows the SEC is proposing to rescind its climate disclosure rules. She said the most useful financial innovation is innovation that improves capital formation, investor understanding, portfolio building and low-cost market access.

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