"In a letter to the Securities and Exchange Commission, Citadel Securities complained that crypto interests are poised to damage the U.S. stock market and harm consumer protections with a pell-mell rush into decentralized finance (DeFi). The firm didn't directly say who it regards as responsible for this state of affairs-but it's enough to guess from the footnotes, which refer to the venture giant Andreessen Horowitz more than 10 times."
"The source of the dispute is the fast-growing world of tokenized equities, which let users trade shares of popular companies but in a blockchain wrapper. The likes of Robinhood, Kraken, and even BlackRock are all dabbling in this technology, whose advantages include easy 24/7 trading and instant settlement. Holding stock on a blockchain also reduces middlemen, and expands opportunities to deploy equity-based collateral."
"Right now, traders use them to swap billions of dollars of crypto every day-and soon large volumes of tokenized Nvidia or Apple stock could be sloshing around these platforms, too. And if the SEC grants certain exemptions that Andreessen and its DeFi allies are seeking, Uniswap and others will get to operate as de facto brokerages-without taking on the legal responsibilities that go with that. These include displaying the price of every trade or ensuring customers get the best price."
Citadel Securities lodged a complaint with the SEC alleging crypto interests could harm the U.S. stock market and weaken consumer protections through rapid adoption of decentralized finance. The firm singled out Andreessen Horowitz in footnotes as a prominent backer of these developments. Tokenized equities enable trading of company shares on blockchains with 24/7 access, instant settlement, fewer intermediaries, and new collateral opportunities. Citadel cautioned that DeFi platforms like Uniswap could act as de facto brokerages if exemptions are granted, avoiding obligations such as displaying trade prices and ensuring best execution. Uniswap's founder and other crypto figures accused Citadel of protecting traditional market-maker profits and stifling innovation.
Read at Fortune Crypto
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