According to SEC Commissioner Mark Uyeda, former President Donald Trump’s DeFi project, World Liberty Financial, will not be exempt from the strict and opaque regulations imposed on US-based crypto firms.
In an upcoming interview with Fox Business journalist Eleanor Terrett, Uyeda acknowledged the challenges Trump’s project will face in navigating the complex regulatory environment for digital assets.
However, he also clarified that these will largely relate to disclosure requirements, and that the SEC would not act as a merit regulator.
He said:
“The Commission is a disclosure regulator, not a merits regulator. We do not assess the benefits or risks of any project, so I am concerned about any calls for us to do so.”
His comments come amid speculation that the Democratic party could push for regulatory action against the company due to deep partisan divisions.
Uyeda, who has been serving as SEC commissioner since June 2022, emphasized that World Liberty Financial will be required to meet the same disclosure and transparency standards that apply to all crypto-related companies in the US.
Despite the former president’s high-profile involvement, Uyeda indicated that the SEC would scrutinize the company to ensure it complies with current laws, warning that Trump’s legal team would need to be prepared to regulatory hurdles.
Uyeda said:
“I would tell them to hire good lawyers because they will have to navigate the same confusing and opaque process that every other entrepreneur in the industry has had to deal with.”
Lack of clear guidance
The SEC’s approach to regulating the crypto industry has been a source of frustration for many in the sector. Uyeda himself has been critical of the commission’s perceived lack of clear guidelines, which has led to growing concerns that regulatory uncertainty could spur crypto innovation abroad.
Nevertheless, Uyeda reiterated that the role of the SEC is to ensure proper disclosure, rather than to determine the value of specific projects.
Hester Peirce, another SEC commissioner, recently echoed these concerns, calling the current regulatory environment “toxic” and warning that the lack of clarity could stifle innovation in the U.S. crypto market.
The push for more transparent regulation has gained momentum among lawmakers, with some calling for a joint advisory body to create a clearer framework for the fast-growing sector. World Liberty Financial has faced skepticism from investors, who doubt its ability to gain traction amid regulatory challenges.
Trump has claimed that the project will help position the US as a leader in the global crypto market, but its success may depend on whether regulators can provide clearer guidance in the near future.