Uniswap Labs Reportedly Under SEC Investigation
- “People familiar with the matter” said that enforcement attorneys are looking into information about how investors use Uniswap and how it is marketed.
- The investigation appears to be exploratory, however, and is unlikely to result in any allegations of wrongdoings.
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The startup behind the largest decentralized crypto exchange, Uniswap Labs, seems to have attracted the attention of the U.S. SEC, which has reportedly launched an investigation, The Wall Street Journal (WSJ) said on 03 September.
Citing “people familiar with the matter”, the WSJ reported that SEC enforcement attorneys are already looking into Uniswap Labs, how investors use the DEX, and how it is marketed to the general public. A representative of the firm told the WSJ that Uniswap Labs was “committed to complying with the laws and regulations governing our industry and to providing information to regulators that will assist them with any inquiry”.
While a representative of the SEC refused to confirm or deny the rumors, the investigation itself appears to be in its exploratory stages, and may not result in any allegations of wrongdoings. The investigation also appears to be in line with SEC chairman Gary Gensler’s statement last month, when he said the agency had plans to create more crypto-related rules targeting DeFi, token offerings, and stablecoins.
Uniswap is the largest DEX on the market at the moment, with data from CoinMarketCap showing it has handled around $1.5 billion in trading volume over the last 24 hours. It enables users to swap between Ethereum-based tokens and coins without the need of a central entity, with all the transactions being operated automatically using smart contracts.
- Popular Telegram bot Unibot, which is used to snipe trades on Uniswap, became a victim of a token approval exploit earlier today, when it was switching to a new router.
- After confirming the exploit, Unibot assured users that their keys and wallets were safe, and that the project will compensate all affected users.
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- During an interview with FT, CEO Brian Armstrong said that before the lawsuit a SEC staff member had said that all crypto except BTC was security, and should be delisted.
- When asked how he came to that conclusion, the SEC staff member reportedly said “we’re not going to explain it to you, you need to delist every asset other that Bitcoin”.
- A federal judge ruled that the sale of XRP through exchanges and algorithms did not qualify as selling securities, which could have a major impact on several SEC lawsuits.
- The institutional sale of the token, however, did violate federal securities laws, and the lawsuit between the SEC and Ripple will have to go to trial.