Former SEC chief of staff Amanda Fischer has sparked significant backlash from the crypto community after comparing liquid staking to factors that contributed to the 2008 financial crisis. In a staff statement, the SEC asserted that liquid staking does not fall under its regulatory jurisdiction. Fischer criticized this guidance, linking liquid staking activities to the rehypothecation practices of Lehman Brothers, which were pivotal to its collapse during the financial crisis. Her comments drew sharp responses; critics argued that the new SEC guidance actually supports decentralized finance and institutional adoption of crypto. SEC Commissioner Hester M. Peirce defended the decision, calling liquid staking a solution to liquidity issues. As of now, liquid staking protocols hold a total value of $66.94 billion, indicating growth in the sector despite a previous dip in April. The ongoing discourse highlights a tension between regulatory perspectives and the rapidly evolving landscape of decentralized finance.

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