Breaking News! The Game between Traditional Finance and the Crypto Market Enters a Heated Phase.
On July 23, 2025, the world's largest market maker Citadel Securities submitted a heavyweight letter to the U.S. SEC, publicly opposing the provision of securities rule exemptions for tokenized stocks, stating that such assets are 'pseudo-innovations using regulatory arbitrage' and may trigger a liquidity crisis in traditional markets. This position quickly received endorsement from Republican SEC Commissioner Hester Peirce, while SEC Chairman Paul Atkins revealed he is studying the 'innovation exemption' mechanism but maintains an ambiguous stance.

The Trillion-Dollar Crypto Sector May Face 'Precise Strikes.'
Tokenized stocks = seen as a key bridge connecting traditional finance and the crypto market. According to the latest data, the global RWA market size has surpassed $50 billion in 2025, with more than 60% of traditional asset tokenization coming from real estate, bonds, etc. Citadel's attack directly targets the core logic of this sector — if tokenized securities are forcibly incorporated into the traditional securities regulatory framework, currently popular innovative models such as 'cross-border issuance, 24-hour trading, fractional ownership' will face skyrocketing compliance costs and may even be deemed 'illegal securities issuance.'

Three Major Shockwaves, the Crypto World Needs to Be Vigilant!

Liquidity Crisis Warning: Citadel warns in a letter that tokenized stocks may divert funds from traditional markets, especially from the daily trading volume of $3 trillion in U.S. stocks. If some of this shifts to on-chain trading, it will impact the interests of existing market makers. This assertion is not unfounded — in 2025, the Korean Kospi index surged by 30% in six months due to the 'Korean Won Stablecoin Policy,' validating the siphoning effect of the crypto ecosystem on traditional markets. Regulatory arbitrage space is narrowing: The SEC's previous lawsuits against Coinbase and Ripple indicate that U.S. regulators are increasingly strict on the definition of 'security tokens.' Citadel's pressure may prompt the SEC to accelerate the issuance of 'tokenized securities guidelines,' requiring project developers to meet all conditions of traditional securities registration, disclosure, custody, etc., thereby raising the bar for innovation. Institutional funds face barriers: Institutions like BlackRock and JPMorgan are entering the crypto market through RWA projects, but if regulations tighten, the compliance costs for participating in tokenized securities will rise significantly.

Crypto Response Strategy: Short-term Risk Aversion, Long-term Game.

Short-term: Pay attention to the SEC's vote in August on the innovation exemption mechanism. If Citadel's position prevails, tokenized securities projects may face a wave of sell-offs, suggesting avoidance of high-risk targets. Long-term: The 'co-opetition' between traditional finance and the crypto market remains a trend. Although Citadel opposes exemptions, it has applied to become a 'top liquidity provider,' indicating that Wall Street is penetrating the crypto space through compliant paths. The crypto world needs to promote a 'technology-neutral' regulatory framework, such as enhancing the transparency of tokenized securities through tools like Chainlink oracles to mitigate regulatory concerns.

Conclusion: Opportunities in the Storm.
Citadel's attack exposes the fatal pain point of tokenized securities — the speed of innovation far exceeds the regulatory adaptation capability. But as stated during the Trump administration's push for a 'strategic Bitcoin reserve' in 2023, 'the crypto industry cannot go back.' This regulatory storm may become an opportunity for industry reshuffling, and only projects that are technically credible and compliant can break through. Crypto investors need to closely monitor SEC policy trends to capture the sparks of the next bull market amidst the storm.

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