Citadel Securities and DeFi Waging War of Words Through SEC Correspondence

After a 13-page letter from funding powerhouse Citadel Securities suggested the U.S. Securities and Change Fee that decentralized finance (DeFi) protocols that deal with tokenized securities require a tighter regulatory grip, the trade has replied back along with his personal correspondence on Friday, calling the arguments “baseless.”

“Whereas we share Citadel’s objectives relating to investor safety, orderly markets, and the integrity of the nationwide market system, we disagree that attaining these objectives will at all times require registration as conventional SEC intermediaries and below sure circumstances can’t be achieved by fastidiously designed onchain markets,” stated the brand new letter to the SEC, signed by the DeFi Schooling Fund, enterprise capital agency Andreessen Horowitz (a16z), the DigitalChamber, Orca Artistic, lawyer JW Verret and the Basis Uniswap.

Citadel Securities argued that DeFi protocols can operate as exchanges or brokerage homes that require registration and regulation. Nonetheless, the SEC’s new administration below President Donald Trump has been wanting this 12 months for tactics to present the crypto trade extra coverage area. And simply White Home crypto advisor Patrick Witt posted on social media site that his workplace helps the “want to guard software program builders and DeFi.”

“As outlined in our remark letters, Citadel Securities strongly helps tokenization and different improvements that may strengthen U.S. management in digital finance, however this doesn’t require sacrificing the rigorous investor protections which have made U.S. fairness markets the worldwide gold commonplace,” a spokesperson stated in an emailed remark.

Citadel’s letter contained “a number of factual mischaracterizations and deceptive statements,” in accordance with the DeFi Coalition’s response. And a spokeswoman for the DeFi Schooling Fund, Jennifer Rosenthal, urged the corporate is defending its enterprise pursuits.

“It’s helpful for Citadel to query the existence of a expertise that threatens its enterprise and important market share,” Rosenthal stated.