Citadel Securities and DeFi Waging War of Words Through SEC Correspondence

Policy Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Citadel Securities and DeFi Waging War of Words Through SEC Correspondence The investing giant had asked the U.S. Securities and Exchange Commission to treat DeFi players like regulated entities, and the DeFi crowd pushed back. By Jesse Hamilton | Edited by Cheyenne Ligon Dec 12, 2025, 10:20 p.m. What to know : A feud conducted over U.S. Securities and Exchange Commission (SEC) correspondence has developed between Citadel Securities and the DeFi sector, arguing over whether DeFi protocols should be more regulated. The DeFi space is calling out the investment firm for its approach to the securities regulator. After a 13-page letter from investment powerhouse Citadel Securities advised the U.S. Securities and Exchange Commission that decentralized finance (DeFi) protocols handling tokenized securities demand a closer regulatory grip, the industry answered back with its own correspondence on Friday, calling the arguments "baseless." STORY CONTINUES BELOW Don't miss another story. Subscribe to the State of Crypto Newsletter today . See all newsletters Sign me up By signing up, you will receive emails about CoinDesk products and you agree to our terms of use and privacy policy . "While we share Citadel’s aims with respect to investor protections, orderly markets, and the integrity of the national market system, we disagree that achieving these goals always necessitates registration as traditional SEC intermediaries and cannot, in certain circumstances, be met through thoughtfully designed onchain markets," according to the new letter to the SEC, signed by the DeFi Education Fund, venture capital firm Andreessen Horowitz (a16z), the DigitalChamber, Orca Creative, lawyer J.W. Verret and the Uniswap Foundation. Citadel Securities contended that DeFi protocols may operate as exchanges or brokerages in need of registration and regulation. However, this year's new management of the SEC under President Donald Trump has been seeking ways to give the crypto industry more policy leeway. And White House crypto adviser Patrick Witt just posted on social media site X that his office supports the "need to protect software developers and DeFi." "As detailed in our comment letters, Citadel Securities strongly supports tokenization and other innovations that can reinforce America’s leadership in digital finance, but this does not require sacrificing the rigorous investor protections that have made U.S. equity markets the global gold standard,” a spokesperson said in an emailed comment. Citadel's letter included "several factual mischaracterizations and misleading statements," according to the DeFi coalition's response. And a DeFi Education Fund spokeswoman, Jennifer Rosenthal, suggested the firm is protecting its business interests. "It is convenient for Citadel to question the existence of a technology that threatens its business and significant market share," Rosenthal said. SEC Citadel Securities DeFi Education Fund More For You Protocol Research: GoPlus Security By CoinDesk Research Nov 14, 2025 Commissioned by GoPlus What to know : As of October 2025, GoPlus has generated $4.7M in total revenue across its product lines. The GoPlus App is the primary revenue driver, contributing $2.5M (approx. 53%), followed by the SafeToken Protocol at $1.7M. GoPlus Intelligence's Token Security API averaged 717 million monthly calls year-to-date in 2025 , with a peak of nearly 1 billion calls in February 2025. Total blockchain-level requests, including transaction simulations, averaged an additional 350 million per month. Since its January 2025 launch , the $GPS token has registered over $5B in total spot volume and $10B in derivatives volume in 2025. Monthly spot volume peaked in March 2025 at over $1.1B , while derivatives volume peaked the same month at over $4B. View Full Report More For You Five Crypto Firms Win Initial Approvals as Trust Banks, Including Ripple, Circle, BitGo By Krisztian Sandor , Jesse Hamilton | Edited by Aoyon Ashraf 5 hours ago The firms have obtained conditional approval from the Office of the Comptroller of the Currency to convert into national trust banks. What to know : Crypto firms Circle, Ripple, Fidelity Digital Assets, BitGo and Paxos received conditional approval by the OCC to become federally chartered trust banks. The move sets up firms to follow in the footsteps of Anchorage Digital, the first to get a federal bank trust charter in the U.S. A slew of stablecoin issuers and crypto firms, including Coinbase, filed for federal oversight after GENIUS Act was written into law. 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