Uneven Rails: U.S. Institutions Warn SEC Against Special Exemptions for Crypto Platforms

By CoinEpigraph Editorial Desk | November 29, 2025

Even in a fast-moving regulatory cycle, it’s unusual to see a coalition of legacy financial institutions, policy groups, and market-structure specialists warn the U.S. Securities and Exchange Commission in unison. Yet that is exactly what happened this week, as several major players submitted a formal letter urging the SEC not to grant “special regulatory accommodations” to selected crypto companies._

The complaint is not about crypto itself.
It’s about uneven rails — the fear that regulators may create a two-tiered system in which certain platforms receive exemptions not available to others, potentially distorting competition and investor protections.

What’s emerging is less a fight over digital assets and more a clash over market integrity, fair access, and rules that govern who gets to participate in U.S. capital formation.

The Core Warning: Don’t Engineer Winners

The coalition’s argument is blunt:
Granting exemptions to specific crypto firms — whether tied to custody, settlement, or token classification — would introduce regulatory asymmetry. In traditional markets, rules are designed so that participants operate on equivalent infrastructure with equal disclosure, supervision, and accountability.

But several firms have reportedly requested:

• modified custody requirements
• accelerated supervisory pathways
• exemptions from existing settlement rules
• experimental frameworks not available to competitors

The coalition argues that these requests are not neutral innovations.
They are preferential rule-shaping that could tilt the competitive landscape before the market has matured.

Investor Protection Isn’t About Crypto — It’s About Predictability

The group’s filing emphasizes a critical point:
Investor protection depends not on whether assets are “digital” or “traditional,” but on whether the regulatory environment is consistent.

Markets absorb innovation well.
They do not absorb surprise exceptions well.

If the SEC authorizes exemptions for a handful of crypto-native firms while holding others to the full burden of legacy rules, volatility would increase — not because of the assets themselves, but because of the uncertainty embedded into rulemaking.

This is where the coalition’s argument resonates with market-structure professionals:
Unpredictable regulation is as dangerous as incomplete regulation.

The Competitive Impact: Rails vs. Relationships

There is also a strategic subtext the coalition did not say explicitly but clearly implies:

• If certain firms get faster access to settlement,
• If certain platforms get relaxed custody burdens,
• If certain ecosystems get bespoke compliance lanes…

…they effectively receive special access to capital rails.

And in modern finance, rails matter more than branding.

The fear is not that crypto firms will grow too powerful.
It’s that their growth is engineered, not earned — produced by regulatory carve-outs rather than market-driven innovation.

What This Means for Crypto Platforms

Crypto companies often argue that legacy rules were not designed for tokenized assets, and therefore modifications are necessary.
There is truth in that.
The current regulatory framework is outdated and difficult to navigate.

But the coalition’s point isn’t about resisting modernization — it’s about ensuring modernization is neutral.

If innovation requires new rules, those rules must:

• apply evenly
• be available to all
• avoid creating privileged classes of institutional gateways
• preserve investor clarity across platforms

Otherwise, digital markets inherit the same structural inequalities that plague legacy systems — simply under a different brand.

The Larger Story: Who Designs the Next Generation of Market Infrastructure?

Behind this debate is a more profound question:

Should the next generation of settlement rails, custody models, and digital marketplaces be shaped by transparent, universal policy — or by selective exemptions granted through negotiations?

The coalition’s letter is a reminder that the architecture of financial markets is built on:

• fairness
• neutrality
• predictable oversight
• access symmetry

When these principles weaken, the market doesn’t just become less fair — it becomes less stable.

This is the quiet battle unfolding beneath the headlines.
And it goes far beyond crypto.

It’s about who controls the rules of the next financial era — and whether those rules are built on open rails or privileged gates.

At CoinEpigraph, we are committed to delivering digital-asset journalism with clarity, accuracy, and uncompromising integrity. Our editorial team works daily to provide readers with reliable, insight-driven coverage across an ever-shifting crypto and macro-financial landscape. As we continue to broaden our reporting and introduce new sections and in-depth op-eds, our mission remains unchanged: to be your trusted, authoritative source for the world of crypto and emerging finance.
— Ian Mayzberg, Editor-in-Chief

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