Tokenization debate reveals gaps in perspectives between TradeFi and crypto on decentralization during SEC panel meeting
Wall Street and crypto executives debated regulatory approaches for tokenization at an SEC panel, highlighting differing views on DeFi decentralization.Summary
During an SEC Investor Advisory Committee meeting, executives from firms like Citadel Securities, Coinbase, and Galaxy discussed the regulation of asset tokenization, revealing significant differences in perspective between Traditional Finance (TradeFi) and the crypto industry regarding decentralized finance (DeFi).
Citadel Securities advocated for the SEC to impose stricter rules on DeFi protocols involved in tokenized securities trading, insisting that intermediaries be fully identified and resisting broad exemptions from definitions like "exchange" or "broker-dealer." Conversely, crypto industry representatives argued that applying traditional broker rules to decentralized exchanges (DEXs) is unworkable, as it would force them to take control of assets, introducing risks not inherent to their structure.
SEC Chair Paul Atkins emphasized the need for compliant pathways to foster innovation, while Commissioner Caroline Crenshaw expressed concerns about investor risks associated with tokenized equities marketed as "wrapped securities," noting they might not be true replicas of the underlying assets.
(Source：The Block)