- Citadel pressed the SEC for tighter oversight on DeFi platforms trading tokenized securities, citing unequal rules.
- Crypto figures fire back, arguing Citadel seeks to shield its profits while stricter rules may push innovation away.
Citadel Securities has urged the U.S. SEC to impose tighter rules on decentralized finance protocols trading tokenized securities. In a letter, the firm requested that all intermediaries be clearly identified, including decentralized trading platforms. The letter argued that giving broad exemptions to these platforms could fracture the regulatory approach to securities trading.
According to the statement, allowing DeFi protocols to operate under different rules “would create two separate regulatory regimes for the trading of the same security.” Citadel warned that such leniency would contradict the technology-neutral standards outlined by the Exchange Act. The company insists that fairness requires the same treatment across platforms, regardless of the underlying technology.
The firm also pointed out that many DeFi platforms function like exchanges. By using algorithms to connect buyers and sellers, they meet regulatory definitions. It also pointed to apps, wallet providers, and automated market makers that receive transaction based compensation. The letter added,
“Realizing the potential benefits of tokenization requires applying the key bedrock principles and investor protections that underpin the fairness, efficiency, and resiliency of U.S. equity markets.”
Uniswap Founder Pushes Back on Citadel’s claims
Uniswap founder Hayden Adams publicly condemned Citadel’s push. Reacting on X, Adams accused its CEO Ken Griffin of pushing anti-DeFi policies for years. He stated,
“The actual nerve for one of their arguments to be that there is no way for DeFi protocols to provide ‘fair access’ of all things.”
Adams further suggested that the real issue for traditional market makers like Citadel is the threat DeFi poses to their profit model. “Makes sense the king of shady TradFi market makers doesn’t like open source, peer-to-peer tech that can lower the barrier to liquidity creation,” he added.
First Ken Griffin screwed over Constitution DAO
Now he's coming for DeFi, asking the SEC to treat software developers of decentralized protocols like centralized intermediaries
Bet Citadel has been lobbying behind closed doors on this for years
Okay thats all pretty bad, but… pic.twitter.com/ExoNhbhadu
— Hayden Adams
Others in the crypto field echoed Adams’ concerns. A policy analyst “BlockProf” commented that Citadel’s letter appeared to adopt arguments previously made by SEC Chair Gary Gensler. “Citadel just declared war on project crypto,” the analyst wrote.
Summer Mersinger, CEO of the Blockchain Association, also criticized the letter. She advised the SEC to reject what she described as an “overbroad and unworkable” approach proposed by Citadel. She argued that its interpretation does not align wit the core principles of the Exchange Act.
Mersinger stressed that if software developers are treated as financial institutions, innovation may shift to other countries while investor protection gains nothing. She stated,
“[Citadel’s] interpretation has no grounding in the Exchange Act, decades of Commission practice, judicial precedent, or the commonsense distinction between those who build software and those who custody assets.”
In early 2025, Citadel Securities reportedly began planning to act as a liquidity provider for cryptocurrencies. The firm aimed to provide liquidity on major exchanges such as Coinbase, Binance and Crypto.com, which initially focusing on non-US markets pending regulatory clarity. As we reported, the firm also helped lead a US$500 million strategic investment round in Ripple.