The warning from former top SEC officials that liquid staking could lead to the collapse of the Rehman style of code has sparked a sharp responsibilities from industry participants, rekindling debate about how the US should regulate staking tokens.
Amanda Fisher, Chief of Staff under former SEC Chairman Gary Gensler; I wrote it On Monday at X, the agency’s stance on liquid staking will “congratulate the Lehman brothers on the same type of redisposal that cratered them.”
Fisher argues that liquid staking creates synthetic tokens through intermediaries, allowing assets to be reused without clear supervision.
She likened it to “re-guarantee,” as practiced by the Lehman brothers before the 2008 financial crisis.
Crypto warned that risk is amplified by decentralization and its ability to “rest, rest, rest, rest” without a doubt, with little monitoring.
However, crypto observers say that the issue is not leverage, but how regulators view cryptography.
Austin Campbell, founder of Zero Knowledge Consulting, crypto risk and compliance advisory firm, said many policymakers continue to approach crypto via the old lens.
“They live in a centralized, mediated world because these systems were the only way to do things effectively in the 1970s when they were designed,” Campbell said. Decryption. “They don’t realize they think everything is centralized, so automated systems are really throwing them at us.”
Still, the question to regulators is to recognize “who is in control,” Campbell said. “If you can control the protocols and actions, you can control the funds, and if you can’t, you can’t.
Kurt Watkins, a blockchain lawyer and founder, said he would advise crypto startups on regulatory strategies. Decryption Fisher raises valid concerns about how staking is misused, but argued that her interpretation is “exaggerating” what the SEC actually said.
Fisher’s SEC guidance reads say it is “very narrow” by confusing receipt tokens with more complicated products.
“The focus is on liquid staking setups that the provider does not exercise discretion, and receipt tokens are passive claims to the original asset, not synthetic products or leveraged locations,” Watkins said. Decryption.
Fisher’s post sparked a quick backlash from the well-known code diagram.
First, the SEC says it is blessings on cryptography. Next, I say that Crypto has no SEC monitoring. Which one is it? Matthew Sigel, head of Vaneck’s digital asset research, says you are in conflict with yourself.” I wrote it x.
Joe Doll and Magic Eden’s General Counsel It was measuredcalling Fisher’s post “incredibly misleading.”
It “indicates either a misunderstanding of the basic technical features that underpin liquid staking (silly/unprepared) or an intentional false features (malicious),” he writes.
Meanwhile, Mert Mumtaz, CEO of Solana Infrastructure Firm Helius Labs, was more direct.
“Comparing a transparent, distributed system dominated by auditable code with something opaque and shady is enforced by fraudsters, saying the former is worse.” I responded. “You don’t know how LST actually works or is intentionally obtuse.”
Fisher is currently working in a better market. I strongly opposed it US creation spots Bitcoin ETF.
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