Citadel, an investment management firm, has asked the US Securities and Exchange Commission (SEC) to regulate decentralized finance (DeFi), the same way it does for traditional finance (TradFi). Naturally, this has caused backlash in the crypto community since the entire premise of DeFi is to be “other than” the traditional financial archetype, which is central in nature.
Hayden Adams, CEO of Uniswap, a decentralized crypto exchange, minced no words in his accusations as he ripped into Citadel.
In a post shared on X on 4 December 2025, Adams wrote that Citadel’s founder Ken Griffin “screwed over Constitution DAO” before “coming for DeFi, asking the SEC to treat software developers of decentralized protocols like centralized intermediaries.” He also claimed Citadel has been “lobbying behind closed doors on this for years.”
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
(@haydenzadams) December 4, 2025
Moreover, Adams had an issue with Citadel’s claim that DeFi cannot provide fair access to markets. In his post, he claimed Citadel to be the king of shady online market makers and that it has a problem with fintechs that can lower the barrier to liquidity creation.
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Citadel Advises SEC: Regulate Crypto In A Technologically Agnostic Manner
All this came about when Citadel sent a letter to the SEC on 2 December 2025, about tokenized stocks and DeFi trading, in which it claimed that DeFi platforms connect buyers and sellers in a manner that fits the legal definition of an exchange or a broker.
The market maker argued that DeFi shouldn’t get any special treatment just because it runs on blockchains. Further, the letter suggested to the SEC that DeFi ecosystem players, including trading app operators, smart contract developers, validators, and liquidity providers, should be strictly regulated.
Citadel Securities thinks any DeFi protocol that facilitates trading of tokenized securities “undermines” US regulatory framework by acting as an exchange pic.twitter.com/BIfGhUHy6s
— Frank Chaparro (@fintechfrank) December 4, 2025
Citedal noted that many of these ecosystem actors earn fees and often influence how trades are routed, similar to how middlemen operate in TradFi. The marketmaker has asked the SEC to take a technology-agnostic approach towards DeFi, i.e., the same rules will apply despite the technology or system used.
Additionally, in its letter, Citadel compared tokenized stock ts to a shadow equity market outside the official US banking system, which could split liquidity and bypass already existing protections for investors.
If Citadel wins this, developers, front-end operators, wallets, market makers, and even DAO participants could face the same strict rules as broker-dealers.
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Citadel Pushes Hard, Crypto Groups Push Back Harder
Crypto groups and prominent crypto personalities have already started to push back, claiming that open-source protocols and validator networks are nothing like Wall Street Intermediaries and that they shouldn’t have to register.
Concerning https://t.co/UC6W1hXIzZ
— Brian Armstrong (@brian_armstrong) December 4, 2025
Citadel, however, has held its ground, saying that the SEC does not have the authority to create separate rulebooks for tokenized equities. Only Congress has the ability to decide on those changes.
Aside from Adams, Blockchain Association CEO Summer Mersinger has pushed back against Citadel’s view, stating that Citadel’s case “lacks grounding in the Exchange Act, judicial precedent, or commission practice.”
The following statement is attributed to @SKMersinger on Citadel’s letter to the SEC, which claims DeFi developers, smart-contract authors, and self-custody wallet providers should be treated as intermediaries subject to securities-law registration.https://t.co/3odP2JepU0 pic.twitter.com/SFieREfHEH
— Blockchain Association (@BlockchainAssn) December 4, 2025
She further argued that the SEC should not treat software developers as financial middlemen. She explained that forcing developers to register as broker-dealers would hurt U.S. competitiveness and drive innovation overseas.
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Key Takeaways
- Citadel wrote a letter to the SEC, urging it to regulate DeFi like TradFi, sparking industry backlash
- Blockchain Association CEO Summer Mersinger has argued that developers shouldn’t face broker-dealer rules
- Citadel has called tokenized stocks a “shadow equity market” outside U.S. protection
The post Citadel Pushes SEC For DeFi Oversight, Crypto Heavyweights Push Back Harder appeared first on 99Bitcoins.
