TechFlow, November 19 — According to Wintermute, the company has met with the U.S. Securities and Exchange Commission's (SEC) cryptocurrency task force and followed up on two key regulatory issues.
Wintermute's two proposals are as follows: First, regulated dealers should be authorized to develop their own clearing and settlement procedures for tokenized securities without triggering the rules applicable to broker-dealers providing clearing services to clients, enabling dealers to settle trades directly. The company argues that current regulations were designed for an era of multi-layered intermediaries, whereas blockchain settlement does not require such layers and in fact reduces the efficiency benefits offered by technology.
Second, proprietary trading and liquidity provision on decentralized finance (DeFi) protocols should not trigger dealer registration requirements. If a firm trades solely for its own account and does not interact with clients, the activity aligns with the long-standing "trader exemption" rule.
Wintermute stated that this approach is consistent with existing laws and court precedents, ensuring that decentralized finance can continue to innovate responsibly within the U.S. regulatory framework.
