Why AI Censorship and Reg NMS Repeal Matter for Crypto Markets: DEX in the City

The federal government pulled Anthropic's Fable 5 offline with no public process — and Jessi Brooks makes the case it's a crypto chokepoint story, not just an AI one.

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The federal government forced Anthropic to take Fable 5 offline last week, and the justification is still murky. Jessi Brooks makes the case that what began as a cybersecurity story is really a chokepoint story, one crypto has seen before. With no transparent process, no technical experts cited, and no clear legal authority, she argues the administration has effectively invented KYC for AI, raising questions far beyond Anthropic.

Katherine Kirkpatrick Bos, Jessi Brooks, and Vy Le work through two regulatory moves with real market-structure stakes. The CFTC released a near-300-page proposed rule on prediction markets, amending Rule 40.11 and clearing political event contracts. The SEC moved to repeal Reg NMS Rules 611 and 610E, two-decade-old market pillars.

Vy Le argues the repeal is crypto's real opening: stop forcing AMMs to fit the old rules and start building the replacement, where solver auctions and cryptographic attestations let investors and regulators verify execution in real time. The throughline across the week is the same: when Washington moves this fast and quietly, is crypto the cautionary tale or the fix?

Hosts:

• ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Katherine Kirkpatrick Bos⁠⁠⁠⁠⁠⁠⁠, General Counsel at StarkWare. Previously held senior legal roles across DeFi and centralized exchanges.

• ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Jessi Brooks⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠, General Counsel at Ribbit Capital⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠

• ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Vy Le - Co-host of DEX in the City and General Counsel of Veda

Timestamps 🤖 03:04 Why the Fable 5 shutdown is a chokepoint story, not just a security one

🔑 09:36 Jessi on why inventing KYC for AI with no process echoes the Gensler era

☢️ 18:48 Why Vy Le puts AI on the threat level of the nuclear bomb

🏛️ 22:36 What the CFTC's near-300-page prediction-markets rule changes in Rule 40.11

📣 34:21 Fidelity: Explore crypto careers that could change your future at https://crypto.fidelitycareers.com

📈 36:32 Why the SEC's Reg NMS repeal could clear the way for onchain markets

⚙️ 41:18 Why Vy Le says crypto already built the tools for better best execution

📑 46:42 Why Citi's 'tokenized shares' aren't shares, plus Coinbase's onchain dividends

🦕 51:26 Crypto good news: Jurassic Finance tokenizes dinosaur bones

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