The DeFi Education Fund (DEF) has urged the US Senate Banking Committee to reconsider its approach to regulating the decentralized finance sector following the release of a discussion draft for a significant crypto market-structure bill. In a letter signed by DEF members, including a16z Crypto and Uniswap Labs, the group emphasized that the Responsible Financial Innovation Act of 2025 should adopt a tech-neutral stance, protect crypto developers from inappropriate regulations, and uphold self-custody rights for Americans. The DEF argued that while legislation should address illicit finance, it must not hinder DeFi innovation. They also called for updates to FinCEN guidance to clarify that non-custodial software should not be classified as financial institutions. Additionally, the DEF requested federal preemption of state laws to ensure uniform protections for crypto developers, warning that traditional financial institutions might exploit regulatory inconsistencies to stifle competition. A16z Crypto separately criticized the draft for potentially undermining investor protections through loopholes related to 'ancillary assets.'
