SEC Clarified Token Buyback FAQ: "No Central Party"
Plus: Bitget reopens bitcoin withdrawals, Tether says it froze $550M in Iran-linked USDT, and Citi picks Coinbase for stablecoin payments
gm, Defiers!
These are the biggest stories in DeFi and crypto:
- SEC staff narrowed its token-buyback FAQ to systems that are functional and have no central party
- Bitget reopened bitcoin withdrawals four days after the breach, with ETH and USDT still frozen
- Tether said it helped freeze about $550 million in Iran-linked USDT as a Senate report questioned its controls
- Citi picked Coinbase to run stablecoin payments for its large corporate clients
- The Compound Foundation denied misusing 8.42 million DAI of V2 reserves turned into COMP voting power
Three days after telling the market that announcing a token buyback carries no promise of managerial effort, SEC staff added four words to the answer: “and has no central party.” The assurance now reaches only systems that are functional and have nobody in control of them.
The Division of Corporation Finance's revised answer to Question 2.5 leaves the rest of the text alone, and the SEC's own version comparison marks the addition and dates it Sept. 28. Under the Commission's March interpretation, a central party is a person, entity or group with operational, economic or voting control of a crypto system. Issuers who still hold that control can no longer point at functionality alone.
Hester Peirce had already said as much on X on Sept. 25: if you have a central party, you cannot rely on this FAQ. a16z crypto's Miles Jennings argued at the time that the limit lived in Question 2.4 and never in the buyback answer, then welcomed the amendment on Sept. 28 as a guard “against attempts to misconstrue it.” The FAQs still bind nobody. What changed is how many issuers can quote them.
Read more below!
Synthetic vs. Direct Tokenized Stocks: Who Wins After The SEC Exemption?
Tokenized stocks picked up two more venues today: Ondo Perps opened spot trading on 12 tokenized stocks and ETFs, and Franklin Templeton fund shares became Bybit collateral. Cooley's Rodrigo Seira, Dinari's Gabriel Otte and Ondo's Peter Curley argued the structural question sitting under both: should a tokenized stock track the price, or be a claim on the share? Watch the full conversation.
SEC Staff Adds 'No Central Party' Limit to Token Buyback FAQ
SEC staff amended Question 2.5 of its crypto FAQ on Sept. 28 so the assurance covers only a system that is functional and has no central party. Where both hold, an issuer announcing a buyback of a non-security crypto asset “would not constitute a representation or promise to undertake essential managerial efforts,” the Howey element that ties expected profits to someone else's work. The original answer, issued Sept. 25, named functionality alone. The SEC's published version comparison marks the added words and dates the change to Sept. 28. Its March interpretation defines a central party as a person, entity or group with operational, economic or voting control of a crypto system. The warning for systems short of functional survives intact: a buyback pitched as yield for holders can still count as that promise.
Bitget Reopens Bitcoin Withdrawals After $387.5 Million Breach
Bitget resumed bitcoin withdrawals at 4 a.m. ET on Sept. 28, four days after the breach it now puts at about $387.5 million. Its public API listed BTC on Bitcoin and BSC as enabled while ETH and USDT stayed off, with ETH across Ethereum, BSC, Arbitrum, Base and Optimism due Sept. 29, USDT on Ethereum, BSC, Solana and TRON on Sept. 30, and the rest including fiat and peer-to-peer on Oct. 2. The exchange says a vulnerability in a third-party security product handed the attacker high-level internal credentials, used to issue fraudulent withdrawal commands that bypassed risk controls, and that private keys and cold wallets were untouched. Gracy Chen said the credentials have been revoked and reissued and the vendor function disabled pending a fix.
Tether Says It Helped Freeze Nearly $550 Million in Iran-Linked USDT
Tether said it helped U.S. authorities freeze roughly $550 million in USDT during 2026 across wallets tied to Iran's central bank and sanctions networks, the same day Sen. Richard Blumenthal and the Permanent Subcommittee on Investigations minority staff published a report questioning its controls. The report found 84% of 846 wallets sanctioned or targeted over links to Iran and its proxies had transacted exclusively or nearly exclusively in USDT, a prevalence measure inside a selected set. Tronscan logs confirm two addresses blacklisted April 23, a day before OFAC added them to the Central Bank of Iran's entry, and four more on July 14, the same day as OFAC's update. The report also alleged blacklisting delays of weeks and $34.6 million still moving through one wallet after designation.
Citi Taps Coinbase for Corporate Stablecoin Payments: WSJ
Citi has picked Coinbase to let its large corporate clients accept stablecoin payments from customers, the Wall Street Journal reported, with Coinbase supplying the payment infrastructure. It extends a collaboration the two announced in October 2025 that began with fiat funding and withdrawals for Coinbase's on- and off-ramps plus payment coordination. Neither the original announcements nor Citi's May update names supported tokens or networks, or says whether a customer-payment service is live or piloting. Citi put its wider payments business at nearly $6 trillion a day in that update, a figure covering the whole operation. The bank is also one of 21 financial institutions behind a joint dollar stablecoin aimed at the first half of 2027.
Compound Foundation Denies V2 Reserve Misuse Allegation
The Compound Foundation rejected governance participant Ugur Mersin's allegation that it misused 8.42 million DAI from V2 reserves, saying the assets stay DAO-owned, sit in a wallet requiring four of six signers, and have funded no Foundation operations. Mersin's Sept. 27 forum post traced the reserves to an exchange and back as 344,780 COMP delegated to the Foundation's voting address, then used to help pass treasury changes and a $52 million V4 program that funds the Foundation itself. The onchain record backs the mechanics: a May 5 transaction shows the COMP arriving, and a receipt that day shows the Foundation casting about 912,717 COMP for both proposals. V4 closed with roughly 1.88 million COMP in favor and none against, clearing quorum without the disputed tokens.
Other Stories Worth Your Time
Chainlink Launches CCIP 2.0 With Custom Verifiers and Faster Transfers — existing integrations keep running on full-finality defaults, while the new token-pool controls need an opt-in contract upgrade.
Ondo Perps Adds Spot Trading for 12 Tokenized Stocks and ETFs — purchased tokens work as collateral for short perpetual positions, and the venue is waiving spot trading fees for the first 30 days.
Franklin Templeton Fund Shares Become Bybit Trading Collateral — eligible clients pledge Benji money-market fund shares for USDT or USDC credit lines while the shares stay in custody and keep paying yield.
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