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DeFi Faces a Crisis of Confidence: Token Examination, Tether’s Rating Cut, and Intensified SEC Crackdowns Converge

DeFi Faces a Crisis of Confidence: Token Examination, Tether’s Rating Cut, and Intensified SEC Crackdowns Converge

Bitget-RWA2025/11/27 03:14
By: Bitget-RWA
- Edel Finance's token launch faces scrutiny as 160 linked wallets allegedly acquired 30% of its supply pre-launch, triggering a 62% price drop. - Tether's S&P downgrade to "weak" highlights risks from $12.9B gold and $9.9B bitcoin reserves, with gold holdings rivaling central banks. - SEC intensifies oversight, fining Yida Gao $4M for crypto fund misrepresentation while exchanges warn against crypto exemptions. - DeFi projects like World Liberty Financial spend $10M on token buybacks, yet WLFI remains dow

Ethereum's DeFi sector continues to face close examination as recent findings raise issues about token allocation methods and regulatory hurdles. A new report from

were reportedly obtained by a network of 160 interconnected wallets before its November 12 debut, with a total value of $11 million. These wallets, which received funds through Binance and MEXC, were described as being part of a complex web of liquidity positions intended to mask true ownership. Edel Finance, a lending platform specializing in tokenized equities and real-world assets, has since experienced a , according to CoinMarketCap. The co-founder of the project justified these actions as part of their token launch plan, but the situation has reignited discussions about equity in token distributions.

DeFi Faces a Crisis of Confidence: Token Examination, Tether’s Rating Cut, and Intensified SEC Crackdowns Converge image 0
At the same time, , the top issuer of stablecoins, is under increased examination. to uphold its dollar peg from "constrained" to "weak," pointing to greater holdings of riskier assets such as and gold in its reserves. in gold and $9.9 billion in bitcoin, with net earnings for the first three quarters of 2025 surpassing $10 billion. The downgrade cited concerns over limited disclosure, regulatory uncertainty, and questions about insolvency protection. rival those of national banks like South Korea's, and the company's gold acquisitions made up almost 2% of global demand last quarter.

Regulatory scrutiny is intensifying as the U.S. Securities and Exchange Commission (SEC) ramps up its enforcement efforts.

, after allegedly providing misleading information about previous investment returns and failing to share BitClout token discounts with investors. In a separate development, major exchanges such as Nasdaq and Deutsche Boerse to crypto companies, citing risks to market fairness and competitive balance. The World Federation of Exchanges (WFE) stressed the importance of maintaining equal standards as tokenized equities become more prominent in mainstream finance.

On the other hand, certain DeFi protocols are testing buyback initiatives to restore investor trust.

spent $10 million to buy back 59 million tokens in a 12-hour period, following a previous $9 million repurchase in October. Despite these efforts, the token’s value is still 50% lower than its September high.

As the cryptocurrency industry contends with regulatory headwinds and internal governance issues, openness and equitable distribution remain essential for rebuilding confidence.

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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