Top Wall Street Firms Met With SEC Crypto Task Force to Discuss DeFi Concerns

As crypto’s coveted marketplace operation measure stalls successful the Senate, apical Wall Street players met with the SEC Tuesday to sermon galore concerns with the regulator’s permissive attack to integer assets.

Representatives of JPMorgan, Citadel, and SIFMA, the almighty securities manufacture commercialized group, met with the SEC’s crypto task unit yesterday to speech done the agency’s bold caller attack to integer assets, according to bureau records.

Topics raised astatine the gathering included worries that the SEC’s imminent plans to supply exemptive relief for tokenized securities could harm the broader U.S. economy, according to gathering records. These concerns besides focused connected the SEC’s stated plans to carve retired immoderate decentralized finance, oregon DeFi, projects from obligations to comply with U.S. securities laws.

“Regulatory attraction should beryllium based connected economical characteristics, not connected the exertion utilized oregon categorical labels (e.g., ‘DeFi’),” materials distributed astatine the meeting, prepared by SIFMA, read. “Broad exemptions for tokenized trading activities could undermine capitalist extortion and pb to marketplace disruptions.”

SIFMA specifically pointed to October’s crypto flash crash—the largest single-day crypto marketplace wipeout successful history, with $19 cardinal successful liquidations—as a peek astatine what could hap should tokenized securities beryllium allowed to commercialized extracurricular existing securities laws.

Representatives for Citadel and JPMorgan did not instantly respond to Decrypt’s requests for comment. A SIFMA typical declined to comment.

Senate Crypto Bill Markup Delayed By Snowstorm, But May Still Get Hit With Partisan Vote

A root acquainted with the substance told Decrypt that cardinal DeFi advocates had not been alert Tuesday’s gathering had taken place.

SEC Chair Paul Atkins said precocious that helium plans to contented sweeping innovation exemptions for the crypto assemblage this month. Such exemptions would springiness crypto companies and projects a warrant that they would look nary hazard of triggering securities laws violations for experimenting successful definite areas, perchance including tokenized securities and DeFi.

The SEC’s assertive propulsion to assistance the crypto manufacture long-desired ineligible assurances comes arsenic a parallel ineligible effort stalls successful Congress. Progress connected a crypto marketplace operation bill, which would enshrine protections for crypto successful national law, has slowed considerably this month, aft skirmishes betwixt crypto leaders and different stakeholders derailed a cardinal Senate vote.

After Coinbase Reversal Forces Delay connected Crypto Bill, Is There a Path Forward?

One specified tension, betwixt DeFi advocates and SIFMA, focused connected connection successful the measure that would exempt definite decentralized fiscal services and their developers from ineligible oversight. Progress appeared to person been made successful negotiations betwixt some parties, though, and decentralization advocates came retired in favor of wherever the measure stood earlier this month.

It yet turned retired to beryllium different inter-industry conflict that posed a much existential menace to the bill’s fate: 1 betwixt Coinbase and the banking lobby implicit rewards connected stablecoin holdings.