The tension between decentralized finance and traditional Wall Street players resurfaced this week after Uniswap founder Hayden Adams publicly accused Citadel Securities of influencing U.S. regulators to impose stricter rules on the DeFi sector.

Adams’ comments, shared across social media, sparked a wide-ranging debate over who should be considered a financial intermediary in blockchain-based markets, and whether the rules of traditional finance should apply to open-source developers.

Adams claimed that Citadel, led by CEO Ken Griffin, has been lobbying the U.S. Securities and Exchange Commission (SEC) to classify DeFi developers, validators, liquidity providers and even front-end operators as broker-dealers.

Citadel’s Filing Raises Concerns Over Tokenized Markets

At the center of the dispute is Citadel’s December 2 filing to the SEC. The document argues that many blockchain-based systems effectively bring together buyers and sellers in ways that resemble traditional exchanges.

As such, Citadel says they should be regulated under the same standards, even if those systems operate through smart contracts rather than centralized infrastructure.

Citadel warned that tokenized U.S. equities trading on DeFi platforms could create a “shadow equity market” outside the national market system, reducing regulatory oversight and fragmenting liquidity.

The firm’s letter also rejects the idea that technology differences justify regulatory exemptions, insisting that “the same activity should face the same rules” regardless of whether it is powered by algorithms or legacy systems.

DeFi advocates counter that this perspective ignores the design of decentralized protocols, which can function without centralized control and often rely on open-source contributions rather than corporate governance.

Adams Pushes Back Against “Fair Access” Claims

Adams criticized Citadel’s assertion that DeFi systems cannot provide “fair access,” calling the argument inconsistent with how traditional market makers operate. He argued that open-source protocols can lower barriers to participation, unlike centralized trading venues where access is limited by intermediaries.

Developers and community members echoed this point, noting that the DeFi ecosystem encompasses a broad range of models, from fully permissionless exchanges to platforms that rely on more centralized components.

Some community voices added that regulatory conversations often lack clarity because “DeFi” itself encompasses many different structures.

The exchange comes at a time when the SEC has repeatedly taken enforcement action against DeFi teams. The agency has emphasized that it assesses economic realities rather than decentralization labels, citing past cases such as the Rari Capital settlement in 2024.

If regulators adopt Citadel’s framing, entities involved in developing or maintaining DeFi protocols could face registration requirements designed for traditional broker-dealers.

Industry participants warn that such a shift could make open-source projects difficult to operate, raising questions about the future of permissionless finance in the United States.

As the debate continues, the clash highlights a deeper divide between emerging decentralized systems and established financial institutions, one that is increasingly shaping regulatory policy discussions in Washington.

Cover image from ChatGPT, UNIUSD chart from Tradingview

Uniswap founder Hayden Adams has accused Citadel Securities of trying to pull decentralized finance into the same regulatory box as Wall Street, after the market maker urged the US SEC to treat DeFi protocols and their developers as traditional intermediaries.

Adams fired off a post on X that quickly made the rounds in crypto circles.

“First Ken Griffin screwed over Constitution DAO,” he wrote, before adding, “Now he’s coming for DeFi, asking the SEC to treat software developers of decentralized protocols like centralized intermediaries.”

He linked directly to Citadel’s submission to the SEC and added, “Bet Citadel has been lobbying behind closed doors on this for years.”

Adams Ridicules Citadel’s Claim That DeFi Lacks Fair Access

He saved his sharpest line for a specific passage in the filing.

Adams pointed to Citadel’s claim that DeFi cannot provide “fair access” to markets and responded, “Okay thats all pretty bad, but the actual nerve for one of their arguments to be that there is no way for DeFi protocols to provide ‘fair access’ of all things lmao.”

He then wrote, “Makes sense the king of shady tradfi market makers doesn’t like open source, peer-to-peer tech that can lower the barrier to liquidity creation.”

The clash stems from a lengthy letter Citadel Securities sent to the SEC on tokenized equities and DeFi trading venues. In that document, the firm tells regulators that many so-called decentralized systems bring together buyers and sellers in a coordinated way and therefore fit existing legal definitions of exchanges and broker dealers.

It argues that activities in DeFi should not receive lighter treatment simply because they are implemented in code on a blockchain.

Firm Rejects Idea That Open Protocols Should Avoid Intermediary Rules

Citadel goes further and lists a wide range of players in the DeFi stack, from trading interfaces and smart contract developers to validators and liquidity providers. According to the filing, many of these actors take transaction-based fees or influence how orders are routed, which, in Citadel’s view, often makes them functionally similar to regulated financial intermediaries.

The firm urges the SEC to apply a technology-neutral approach so that the same activity attracts the same rules regardless of whether it runs through a matching engine or a smart contract.

A central concern in the letter is tokenized stocks. Citadel warns that allowing tokenized shares of US companies to trade freely on DeFi protocols would create what it describes as a shadow equity market outside the national market system. It says such a structure could fragment liquidity and bypass the reporting, surveillance and investor protection framework that currently governs equities.

The firm also resists calls from some crypto industry groups for broad exemptions. Several DeFi advocates have asked the SEC to recognise that open source protocols and validator sets do not operate like traditional intermediaries and should not have to register as exchanges or broker dealers.

Crypto Devs Fear Wall Street Rules Would Stifle Permissionless Innovation

Citadel counters that the agency lacks authority to carve out a separate regime for tokenized equities and argues that any fundamental change to how US stocks trade belongs with Congress.

If regulators accept Citadel’s framing, protocol teams, front-end operators, routing wallets, market makers and possibly even DAO participants could face registration, capital rules and best execution duties that were designed for broker-dealers.

Many in crypto see that outcome as incompatible with global, permissionless software that can be deployed by small teams and maintained by distributed communities.

Adams framed the episode as part of a longer story. In his post, he reminded followers that Citadel founder Ken Griffin outbid ConstitutionDAO at a Sotheby’s auction in 2021, thwarting the crypto collective’s attempt to buy a rare copy of the US Constitution.

By opening his thread with “First Ken Griffin screwed over Constitution DAO,” then pivoting straight into the SEC fight, he linked that high-profile clash with Citadel’s latest move in Washington.

The post Uniswap Founder Blasts Citadel for Urging SEC to Treat DeFi Like Wall Street appeared first on Cryptonews.

DeFi is no longer chasing yield. It’s chasing sustainability.

In 2025, two of the industry’s biggest protocols — Uniswap and Hyperliquid — are proving that value capture isn’t about token emissions anymore. It’s about who can buy back and burn the fastest.

Uniswap, the blue-chip decentralized exchange, finally flipped its long-dormant “fee switch,” activating a deflationary burn model through its new UNIfication proposal. Meanwhile, Hyperliquid, the rising perpetual DEX, has quietly been buying back its own token nonstop — pouring 97% of all trading fees into automated HYPE repurchases.

Both are rewriting tokenomics in real time. But their philosophies couldn’t be further apart.

Uniswap’s Long-Awaited Fee Switch

For half a decade, Uniswap’s “fee switch” lived in GitHub limbo — designed but never activated for fear of SEC scrutiny. That changed on November 10, 2025, when founders Hayden Adams, Ken Ng, and Devin Walsh submitted a proposal that redefines how UNI captures value.

At the center is a fee-to-burn model:

• On v2, protocol fees rise from 0% to 0.05%, trimming LP rewards from 0.3% to 0.25%.
• On v3, fees vary per pool — one-quarter of LP fees for low-tier pools, one-sixth for higher tiers.

All collected fees flow into a “token jar” smart contract, where anyone can burn UNI to withdraw an equivalent amount of crypto.

Even Unichain, Uniswap’s layer-2 chain, joins the burn loop — its sequencer fees now add to the same deflationary circuit. It’s the first time Uniswap’s L2 and protocol income have merged under one system.

And in a surprise move, Uniswap Labs announced it will stop collecting all interface, wallet, and API fees, sending every cent of value capture to the protocol itself.

For context, the plan also includes a 100 million UNI treasury burn, a one-time “catch-up” representing fees that could’ve been burned since 2020. That’s a 16% supply cut — the largest in Uniswap’s history.

Hyperliquid’s Relentless Buyback Engine

While Uniswap argues governance, Hyperliquid just runs code. Its system is brutally straightforward: every trade feeds a buyback.

About 97% of all trading fees flow into the Assistance Fund, an on-chain vault that automatically repurchases HYPE. Maker rebates still reward traders, but nearly everything else goes into compression. No votes. No proposals. No DAO bottlenecks.

By October 2025, the fund had spent $644.64 million — equal to 46% of all buyback spending across crypto that year. In total, 21.36 million HYPE were repurchased at an average price of $30.18.

And that resilience isn’t hypothetical. It was battle-tested during the October 10, 2025 crash, when $19 billion in liquidations hit in 24 hours. Binance froze under load, but Hyperliquid stayed online, processing nearly half of all liquidations.

According to @aixbt_agent, Hyperliquid burns around $25M weekly, already removing nearly $900M from circulation at a pace of $3.6M per day. Its revenue now exceeds Ethereum, Tron, and Jupiter combined, with HYPE trading solely on its own DEX — sealing off external arbitrage while buying back faster than most projects even earn.

Even skeptics have come around. As @stevenyuntcap noted, calling Hyperliquid “just airdrop hype” misses the point — the protocol found real product-market fit. Its engine runs on usage, not speculation.

UNI vs HYPE: Two Paths to Deflation

As of November 2025, UNI trades around $8 with a $5.5B market cap.

While HYPE sits near $40 and $11B — more than double.

The imbalance isn’t arbitrary. Investors see Hyperliquid’s machine as tighter, faster, and mathematically reliable.

Uniswap, by contrast, trades like a blue-chip utility — credible, but governance-heavy.

When it comes to fee generation, Uniswap pulls in about $1.8–$1.9B annually, all currently going to liquidity providers. Under UNIfication, one-sixth to one-quarter of that flow redirects to burns — roughly $460M per year.

Hyperliquid’s system dwarfs it: $1.29B annualized revenue, with $1.15B (89%) going straight into buybacks. It’s the DeFi equivalent of an 89% reinvestment rate — absurd for a protocol barely two years old.

Analyst @bread_ compared the two directly: UNI’s proposed burn would equal $38M per 30 days, ahead of $PUMP ($35M) but far behind $HYPE ($95M).

Governance vs Automation

Uniswap’s model depends on coordination. Every adjustment requires DAO approval, and liquidity providers — a powerful bloc — could vote to reduce burns if returns thin out. The system is elegant but fragile.

Hyperliquid’s design is mechanical. If volume rises, buybacks rise. If it drops, the system scales down. No committees, no politics. But that precision hides risk — Hyperliquid’s closed-source HyperCore and centrally managed Assistance Fund leave it exposed to trust and transparency challenges.

Who’s Winning So Far?

In raw performance, Hyperliquid leads. It’s executed $645M in buybacks in ten months — nearly triple Uniswap’s projected annual burns. The market knows it: HYPE’s market cap is twice UNI’s.

But Uniswap’s edge is longevity. Its governance structure, transparency, and integration across Ethereum and Unichain make it a potential long-term survivor — one that can adapt as regulation tightens and new DAOs form.

The real bet? Automation vs alignment.

Hyperliquid dominates now through speed and consistency. Uniswap could win later if it proves that community-driven economics can scale without collapsing under politics.

Either way, 2025 marks a turning point: DeFi tokens are finally backed by real cash flow, not inflation.

This article is part of DropsTab Research.

Hyperliquid vs Uniswap: Who’s Winning DeFi’s Buyback War? was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.