Are banks actually pro-crypto? Galaxy’s Alex Thorn exposes how Wall Road lobbyists combat tokenized shares behind closed doorways at SEC.
Wall Road has quietly shifted its battleground. Banks and brokerages now again Bitcoin and crypto publicly.
Behind closed doorways, nonetheless, their Washington lobbyists are combating actual crypto integration.
Galaxy’s Alex Thorn known as this out instantly. He posted a breakdown of a brand new letter Galaxy submitted to the SEC, responding to pushback from SIFMA and Citadel on tokenized shares.
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Wall Road’s “Neutrality” Argument Does Not Maintain Up
Thorn says incumbents are leaning on a flawed studying of know-how neutrality. Their model calls for that on-chain methods mirror every bit of legacy infrastructure.
Galaxy’s letter pushes again on this.
Actual neutrality, Thorn argues, is about outcomes, not construction. The take a look at is whether or not investor safety, market integrity, and transparency are achieved. If an on-chain market clears that bar by way of totally different means, it qualifies.
Forcing it to repeat old-school intermediaries just isn’t neutrality. It’s incumbency safety dressed up in authorized language.
banks and brokerages are enjoying a cynical recreation: backing bitcoin and crypto in public whereas their DC lobbyists delay, impede, and oppose actual integration
bitcoin has already received. tokenized shares are the subsequent entrance
we simply answered SIFMA/citadel in a brand new letter to the SEC pic.twitter.com/CXnQxelhzT
— Alex Thorn (@intangiblecoins) April 16, 2026
AMMs Are Not Exchanges, and LPs Are Not Sellers
Galaxy’s letter takes on two particular claims regulators and incumbents have raised.
The primary is whether or not qualifying automated market makers rely as exchanges.
Thorn says they don’t. An alternate, underneath the statute, is a corporation, affiliation, or group of individuals. A qualifying AMM is code.
As soon as deployed, nobody runs it. Nobody manages an order e-book, halts buying and selling, or controls entry. It merely runs. Tagging it as an alternate misreads the legislation.
The supplier classification will get the identical therapy.
Liquidity suppliers on qualifying AMMs commit their very own belongings. They haven’t any clients. They don’t solicit orders or quote two-sided markets. Furthermore, they deposit belongings right into a pool and earn a share of charges when others commerce in opposition to it.
Thorn says that appears much more like an investor utilizing their very own stability sheet than a supplier working a enterprise. Even lively LPs adjusting their positions are nonetheless simply buying and selling for themselves.
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Pseudonymity, Transparency, and MEV Considerations Are Overblown
Galaxy’s letter additionally addresses the fallback objections.
On pseudonymous wallets, the reply is compliance at regulated entry factors. Switch brokers can tie permitted wallets to verified identities. The structure doesn’t block KYC. On transparency, Thorn says incumbents have it backwards.
Public blockchains publish full buying and selling historical past, pool states, pricing curves, and execution knowledge in actual time. That’s extra clear than the legacy system, not much less.
On MEV and manipulation, Galaxy says the dangers are overstated. MEV just isn’t misuse of personal info. Bigger incidents are avoidable. And if a whitelisted holder misbehaves, their identification will be traced.