Gensler's former assistant against liquid staking: "It would be a big loss"

Amanda Fischer, a former senior executive at the SEC known for her closeness to Gary Gensler, criticized her agency's comments on liquid staking.

"It resembles Lehman Brothers"

Fischer stated that the synthetic token created in liquid staking poses a great danger and that cryptocurrency could prepare for its own collapse in this way.

"Liquid staking allows the user to deposit their cryptocurrency into an exchange and receive a synthetic crypto in return. This token is issued by a centralized entity. Rewards are earned from the real token, and investment continues with the resulting synthetic token. This is no different from the situation where Lehman Brothers used customer funds..."

It was at the center of the Lehman crisis

As a reminder, the "2008 crisis", one of the largest financial crises in recent history, was centered around Lehman Brothers bank. The bank's investments, particularly in the real estate sector, were cited as one of the main reasons for its bankruptcy. However, the US government did not bail out the bank and allowed it to fail. Nonetheless, the escalation of the crisis caused many other companies to be put at risk, and these institutions were rescued by the government.

"Synthetic token on top of synthetic token..."

Amanda Fischer stated that in the event of the hacking or failure of the liquid staking token, there is a possibility that the cryptocurrency world could enter a much larger crisis.

"Assets are being staked, then restaked, again and again... One synthetic token on top of another synthetic token... Like leverage tied to mortgage loans... A mortgage loan granted to risky clients is a risk for a bank. But if 30 times the transactions are made on top of this mortgage loan, things go south."

"They continue to look at it with an old mindset"

The crypto world criticized Fischer's statements. Austin Campbell, the founder of Zero Knowledge Consulting, which works on risks and regulations in cryptocurrencies, said the following:

"These people still look at things with an old mindset. They still think there is a world with central and intermediary institutions. Because that was the system in the 1970s. They do not understand what automated systems can do. If you control the protocol, you also control the funds. If you cannot control the protocol, you cannot control the funds either."

As a reminder, the SEC had assessed in a statement made yesterday that "a portion of" liquid staking products would not fall under the status of securities sales. Fischer's tweets came in response to this statement.

Fischer is currently part of a political group called Better Markets, which is also opposed to crypto ETFs.

Published: August 6, 2025 09:42Last Updated: August 6, 2025 09:48