DeFi Patron "O" Explains Altcoin Departure for the First Time: Pressures from SEC on Token Sales Have Arrived! - Coin Bulletin

After receiving the first inquiry letter from the SEC about YFI in 2021, Andre Cronje decided to withdraw from crypto projects in 2022 due to increasing regulatory pressures.

When Andre Cronje** quietly withdrew from the DeFi world in 2022**, many people wondered why. Cronje, who did not make any official statement at the time, is now explaining the behind-the-scenes of the process.

Cronje, who stated that he received a letter from the U.S. Securities and Exchange Commission (SEC) in 2021 regarding Yearn Finance (YFI), said that the regulators requested detailed information on how YFI was created.

(# Increasing regulatory pressure

Cronje states that he launched Yearn Finance in 2020 without any fundraising process, did not conduct token sales, and did not make any financial gains from the project. However, SEC's reviews became more intense over time. In the initial letter, SEC only requested information, but later changed the direction of the investigation. First, it was investigated whether Cronje initiated the project with an illegal securities offering )ICO(. Then, it was questioned whether Yearn Finance is an investment vehicle due to the benefits it provides to investors from third parties.

During this process, Cronje states that he had to collect documents for weeks to meet the SEC's demands and ultimately had to seek legal support. However, he emphasizes that the process itself became a significant burden due to the lack of any formal company structure or capital.

)# A tough decision: Withdrawal

This process, which lasted for about two years, almost caused Cronje to completely stop working on his projects. Having to spend a large part of his time responding to regulatory requests, Cronje eventually decided that withdrawal was the best option.

However, Cronje, who says he never lost interest in DeFi, tried to learn how traditional finance and regulatory structures work during this process. Now, he continues his work to develop new projects and is preparing to launch his new financial instruments in the near future.

Cronje argues that the SEC's current approach has alienated many developers from the industry and that it is impossible to regulate decentralized projects by their very nature. Cronje, who says that his writings on the subject were misunderstood at the time, now states that he is able to explain the past process.