A group of crypto organizations, including Andreessen Horowitz and the Uniswap Foundation, have challenged Citadel Securities’ request to tighten SEC regulations on decentralized finance and tokenized stocks. They argue that Citadel’s analysis of securities laws is flawed and that onchain markets can still protect investors without traditional SEC registration. Citadel’s request is deemed impractical by the group, as regulating decentralized platforms would capture a wide range of activities not typically considered exchange services. The group also refutes Citadel’s claim that autonomous software can act as an intermediary, stating that DeFi technology protects investors in ways traditional finance cannot. Citadel’s argument that exempting DeFi platforms from securities laws could harm investors was met with backlash, with Blockchain Association CEO Summer Mersinger calling it an “overbroad and unworkable approach.” The SEC is seeking feedback on regulating tokenized stocks as the agency chair suggests the US financial system could embrace tokenization in the coming years. NYDIG warns that assets moving onchain won’t have immediate benefits for the crypto market until regulations allow deeper integration with DeFi.

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