SEC Commissioner Hester Peirce stated that the agency’s Innovation Exemption offers a temporary pathway for tokenized securities to trade via AMMs, aiming to prevent overseas markets from monopolizing tokenized exposure to U.S. equities and serving as a bridge to longer-term regulations. She also criticized the current KYC/AML model for creating ever-larger “data haystacks” with limited effectiveness and turning the financial system into a “panopticon,” advocating for zero-knowledge proofs and attribute-based credentials to verify compliance without collecting or repeatedly storing users’ sensitive personal data.