The U.S. Securities and Exchange Commission (SEC) must adapt to stay relevant in a rapidly changing financial landscape. Tuongvy Le, a former senior SEC attorney, argues that the SEC should proactively foster innovation rather than simply react to it. Throughout its history, the SEC has successfully embraced change, notably through the introduction of digital filings and alternative trading systems. However, it has lagged in addressing high-frequency trading and the crypto sector, where its approach has been marked by caution and enforcement rather than clarity and support. To regain its leadership role, the SEC should revise its mandate to include fostering innovation, rethink success metrics beyond enforcement actions, establish an innovation office, adopt risk-based regulation for new financial products, and invest in staff education on emerging technologies. By leveraging blockchain and other innovations, the SEC can enhance transparency, reduce risks, and promote financial inclusivity. The challenge remains for the SEC to lead rather than follow in this evolving landscape of finance.

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