News View Non-AMP

Tensions Rise as Ex-SEC Chief Warns of Crypto Meltdown

Published by
Zameer Attar and Anjali Belgaumkar

Former US Securities and Exchange Commission (SEC) chief of staff Amanda Fischer released a warning that liquid staking could trigger crypto’s own Lehman-style collapse. This statement has drawn attention from the crypto industry and also triggered fear and debate over how the U.S. should regulate staking tokens.

Ex-SEC Chief Faces Backlash Over Lehman Brothers Comparison

Fischer drew sharp criticism after making a statement on X, comparing liquid staking mechanisms to the practices that contributed to Lehman Brothers’ 2008 collapse. The SEC clarified on Tuesday that it does not consider most liquid staking activities as securities offerings and, therefore, outside its jurisdiction. 

Fischer then criticized the agency’s stance, saying it legitimizes a system in which crypto assets are repeatedly staked and restaked with minimal transparency and accountability. Noting the contradictions in her statement, prominent crypto figures criticised her. 

Crypto Industry Denounces Fischer’s Misleading Statements

Joe Doll, general counsel at Magic Eden, also slammed Fischer and called her statement “incredibly misleading.” It “demonstrates either a misunderstanding of the basic technological features that underpin liquid staking (dumb/ill-prepared), or deliberate mischaracterization (malicious),”  he wrote on X.

“First, you say the SEC is blessing crypto. Then you say crypto has no SEC oversight. Which is it? You’re contradicting yourself mid-rant,” Matthew Sigel, head of digital assets research at VanEck, wrote on X.

Mert Mumtaz, CEO of Solana infrastructure firm Helius Labs, stated, “Comparing transparent, decentralized systems governed by auditable code to opaque, shady ones enforced by crooks and saying the former is worse is insane work.”

“You either have no idea how LSTs actually work or are being intentionally obtuse,” he added. 

Fischer Draws Tension in the Crypto Space

While Fischer’s statements are broadly drawing criticism, it also triggered fear and tension among crypto investors. It highlighted the ongoing challenges of balancing innovation with oversight as the crypto sector rapidly evolves. Investors now suspect that minimizing risks in the decentralized ecosystem may stifle innovation. 

FAQs

Who is Amanda Fischer?

Former SEC chief of staff Amanda Fischer warned that liquid staking could trigger a “Lehman-style collapse” in the crypto market.

What is the SEC’s official stance on liquid staking?

The SEC has clarified that it does not consider most liquid staking activities to be securities offerings and are thus outside its jurisdiction.

What larger debate has this warning sparked?

The warning has highlighted the ongoing challenge of balancing crypto innovation with regulatory oversight and the fear that regulation may stifle progress.

Zameer Attar and Anjali Belgaumkar

Zameer is a financial analyst and writer with a particular interest in cryptocurrency markets. He has been studying cryptocurrencies and their market behavior for several years and deeply understands the factors that affect the price of cryptocurrencies. His expertise lies in his ability to use both technical and fundamental analysis to make informed predictions about the future direction of cryptocurrency prices. He has a strong understanding of market sentiment and uses this to inform his trading decisions and price predictions.

Recent Posts

Fed Official Kashkari Backs Two Rate Cuts in 2025; Rate Cut Odds Hit 93%

There are growing concerns at the Fed over an economic slowdown, and calls for rate…

August 6, 2025

Blockchain-Ads Review: Is It the Best Advertising Platform?

Blockchain-Ads is a 3rd-generation advertising platform built for marketers who operate at scale and require…

August 6, 2025

XRP Gains Momentum at $2.90, Yet Ozak AI’s Under $0.10 Price Could Offer 220x Upside With $1.5M Raise

XRP traded at $2.79 after a 6.91% daily decline, holding a $165.81 billion market capitalization…

August 6, 2025

The Most Undervalued Coin To Invest In Right Now: Is It Cardano (ADA), Pepe Coin (PEPE) or Remittix (RTX)?

Finding the best crypto to buy now means identifying projects with strong fundamentals, clear utility,…

August 6, 2025

Dogecoin and Shiba Inu Get The Cold Shoulder As Remittix 13,000% Growth Prospects Shine

The world of cryptocurrency has always been fast-moving, with certain tokens grabbing the spotlight and…

August 6, 2025

Ripple vs SEC: Extension or Ending? Expert Reveals What’s Next for XRP Lawsuit

The legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC) is once…

August 6, 2025