Crypto Groups Push Back on Citadel’s DeFi Rule Demands

Crypto News Regulation

Crypto Groups Fire Back at Citadel’s Call for Stricter DeFi Oversight

Written by Aaron S.,

Editor-In-Chief

Last Updated: December 15, 2025

Key Takeaways

Crypto organizations opposed Citadel’s push for tighter SEC control over DeFi tokenized stock trading by calling its claims misleading;
The groups argued that applying securities laws to DeFi would unfairly include entities with minimal roles in transactions;
They said decentralized systems can protect investors and ensure fair markets without relying on traditional intermediaries.

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Crypto Groups Fire Back at Citadel’s Call for Stricter DeFi Oversight

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Several cryptocurrency groups have criticized Citadel Securities for urging the US Securities and Exchange Commission (SEC) to impose tighter controls on decentralized finance (DeFi) systems dealing with tokenized stocks.

Citadel had previously asked the SEC not to give DeFi platforms special permission to trade digital versions of US equities.

The firm argued that these platforms could fall under definitions such as “exchange” or “broker-dealer” and should therefore meet the same registration requirements as traditional financial firms.

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In response, organizations including Andreessen Horowitz, the Uniswap UNI $4.94 Foundation, the DeFi Education Fund, and The Digital Chamber sent a joint letter to the SEC. They said their aim was “to correct several factual mischaracterizations and misleading statements” made in Citadel’s submission.

The group claimed the company’s position would extend registration rules to almost any party involved in a DeFi transaction, even if their role was minimal.

They acknowledged that protecting investors and maintaining fair markets are important goals. However, they argued that these goals do not always require platforms to operate under traditional SEC registration.

They said that well-designed blockchain-based markets can meet the same standards of fairness and safety without the need for centralized intermediaries.

Furthermore, the group rejected Citadel’s claim that autonomous software acts as a financial "middleman". They wrote that computer code cannot play such a role because it has no independent judgment or decision-making power.

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