SEC Slaps Down OpenVPP: The Fake Endorsement and Why Everyone's Screaming 'Scam'

Let me get this straight. The SEC, the big bad wolf of the financial world, decides to try something new for a change. They send out one of their own, Hester Peirce—the so-called "Crypto Mom," for God's sake—on a listening tour. Not to slap wrists or hand out subpoenas, but to actually talk to the little guys. The startups with ten employees crammed into a glorified closet, running on ramen and dreams of a decentralized future.

It's called the "Crypto on the Road" tour. A rare chance for the Davids of the industry to look Goliath in the eye and say, "Here's what it's really like down here in the trenches." And what happens? What's the very first thing one of these plucky upstarts does with this golden opportunity?

They try to pull the dumbest, most transparent con I've seen all week. And believe me, I've seen a lot.

How to Weaponize a Handshake and a Photo

The Grip-and-Grin That Broke the Camel's Back

Enter OpenVPP, a name you've probably never heard of and, if there's any justice, will never hear again. Their CEO, a guy named Parth Capadia, gets his moment at the Chicago roundtable. He gets to shake the Commissioner's hand. He gets a photo.

And what does he do with that photo? He slaps it on X, the internet's town square of terrible ideas, with a caption that reads like a press release written by a pathological liar. "Excited to announce that we are working alongside [Commissioner Pierce] and the U.S. Securities Exchange Commission on the Tokenization of Energy."

"Working alongside."

Let's just pause and savor the sheer audacity of those two words. That's not just a slight exaggeration. It's a full-blown fabrication. It's the crypto equivalent of getting a selfie with a celebrity at an airport and then announcing you've been cast as their co-star. I can just picture the scene. The stale conference room air, the hum of the air conditioning, the polite, forced smiles for the camera. A moment of access, twisted into a fraudulent marketing asset before the flash had even faded.

This was a bad move. No, 'bad' doesn't cover it—this was a five-alarm dumpster fire of a decision. They weren't "working alongside" anyone. They were in a room with a regulator who was gracious enough to hear them out, and they immediately tried to leverage her reputation to pump their project. It's the kind of short-sighted grift that gives this entire industry a black eye.

When "Hide Reply" is Your Entire Business Strategy

The World's Gentlest Public Execution

Hester Peirce, to her credit, didn't let it slide. She didn't send in the lawyers or launch a formal investigation. She just replied, right there on X for everyone to see. "I welcome the chance to meet with crypto projects... but I do not ‘work alongside’ or endorse private crypto projects or firms."

It was a masterclass in polite, professional evisceration. A digital "bless your heart."

And what did the brave innovators at OpenVPP do when faced with this direct, public correction from one of the most powerful people in their field? They hid her reply.

Read that again. They didn't apologize. They didn't clarify. They hit the little "hide reply" button, hoping the problem would just... go away. As if you can just memory-hole a public statement from an SEC Commissioner. It's this pathetic, cowardly little detail that transforms the story from a simple PR blunder into a perfect parable for the crypto age. It ain't just the lie; it's the contemptible cover-up. It's the belief that you can just manipulate the narrative and nobody will be smart enough to notice.

Then again, maybe I'm the crazy one here. Maybe this is just how business is done now. You post your "truth," you hide any inconvenient facts, and you let the algorithm and your paid-for marketing accounts do the rest. The fact that analysts quickly pointed out that most of the accounts hyping OpenVPP were known promo bots is, offcourse, just the rotten cherry on top.

This is the kind of thing that drives me nuts about corporate communications in general. It's all just signaling. My company cares about the environment. My company supports the troops. It’s all the same empty performance, just OpenVPP was clumsy enough to get caught doing it to a federal regulator.

html The SEC Tried to Be Nice. That Was a Mistake.

An Olive Branch, Used as a Club

The real tragedy here isn't one clownish project immolating itself in public. The tragedy is what this does to the SEC's entire outreach effort. Peirce and her task force are trying to move away from the old "regulate by enforcement" model. They're trying to have a dialogue. They're visiting cities from L.A. to Cleveland to hear from people who don't have the cash for D.C. lobbyists.

They're doing exactly what the industry has been screaming for them to do for years: listen.

And this is the thanks they get. A project takes that good-faith gesture and immediately tries to weaponize it for a quick credibility boost. How is any regulator supposed to engage with the industry when this is the response? Every future meeting will be tainted by this. Every photo-op will come with a hundred disclaimers. OpenVPP didn't just embarrass themselves; they poured poison in the well for every legitimate small project that comes after them.

They saw an open hand and tried to bite it, and I just... I don't know what you do with that. It proves every cynical, anti-crypto talking point right. It reinforces the narrative that the entire space is just a playground for scammers and hucksters.

So the Crypto Task Force will move on to New York City, and then Scottsdale, and the tour will continue. But the vibe has to have changed. That initial optimism, that hope for a new kind of dialogue, has to be a little more tarnished now, a little more jaded. Thanks to one company's spectacular failure of judgment.

This Is Why We Can't Have Nice Things

In the end, this isn't just a story about one dumb crypto project. It's a story about human nature. The SEC extends an olive branch, a genuine attempt to understand a new and volatile industry from the ground up. And the very first person in line snatches it, tries to sell it as a government-endorsed product, and then acts shocked when they get called out. It makes you wonder if the whole "enforcement-first" approach wasn't the right one after all. You try to be the "Crypto Mom," and you end up having to ground the kids for lying. What a mess.

Reference article source：

• OpenVPP Price: OVPP Live Price Chart, Market Cap & News Today
• Crypto Task Force Tour Continues as Hester Peirce Denies Endorsing OpenVPP
• SEC commissioner Hester Peirce did not endorse OpenVPP despite meeting