Wintermute Sends Opinion Letter to SEC: Dealers Should Be Allowed to Independently Manage On-Chain Settlement Processes, Proprietary Trading on DeFi Should Not Require Registration
According to ChainCatcher, in the latest comment letter submitted to the SEC's Special Working Group on Crypto Assets, Wintermute made two clear proposals: 1. Allow self-managed on-chain settlement processes: Wintermute urges the SEC to clarify that regulated dealers, when settling on-chain for their own accounts, should not be considered in violation of the rules for bypassing traditional clearing institutions. As long as the counterparty can independently manage its wallet and deliver on-chain, and the dealer fulfills its obligations in a timely manner, it should be exempt from the application of the "Customer Protection Rule." This approach can significantly reduce intermediary layers and improve the efficiency of blockchain settlement.
2. Proprietary trading on DeFi does not require dealer registration: Wintermute emphasizes that engaging only in proprietary trading (including liquidity provision) on DeFi protocols, without interacting with clients, assuming market-making obligations, providing advice, or custodying assets, should be regarded as an "investor" rather than a "dealer," and therefore does not require registration. This position continues the legal tradition of the "trader exemption" and echoes the judicial trend after the "dealer rule" was overturned by the courts in 2024. Wintermute stresses that, under the current legal background, innovation and regulation should coexist, and inappropriate regulatory burdens on the decentralized finance ecosystem should be avoided.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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