Uniswap lab has advised the agency to respect constitutional constraints and learn from previous rulings, in response to the SEC’s Wells Notice.
The business that created the decentralized exchange Uniswap, Uniswap Labs, has responded to the U.S. Securities and Exchange Commission’s Wells Notice.
The native token of Uniswap, UNI, has increased 3.7% this week and 2.0% over the past 24 hours to reach $9.48.
Uniswap Labs criticizes SEC’s Legal Basis.
Uniswap Labs attacked the SEC’s justification for the notification in a blog post on May 21 and labeled it as “weak.” According to a list provided by the business, the agency should reevaluate its justifications for pursuing legal action.
According to Uniswap, the SEC’s notification was predicated on the idea that all tokens are securities. According to Chief Legal Officer of Uniswap Labs, Marvin Ammori, Tokens are a file format for value and not intrinsic securities. He continued by criticizing the SEC’s attempts to expand the definitions of phrases like “broker,” “exchange,” and “investment contract” to encompass Uniswap’s business practices.
Ammori also cited a recent federal judge’s decision rejecting comparable allegations against the Coinbase Wallet to highlight the likelihood that the SEC’s allegation that Uniswap’s interface and wallet function as brokers would be dismissed.
Uniswap has stated that its attorneys have successfully defended instances similar to Grayscale and Ripple, indicating that it is prepared to take legal action and refute any accusations.
Attorneys for Uniswap cautioned that legal action against the company will inevitably force U.S. cryptocurrency investors to use overseas trading systems. Moreover, it can deter future inventors from developing fresh concepts that foster competition and creativity in the financial and business sectors.
Reaction as the Cryptocurrency Regulation Bill Vote Approaches
Just before the U.S. House of Representatives votes on the Financial Innovation and Technology for the 21st Century Act, Uniswap Labs has responded. The measure intends to change the SEC’s and the CFTC’s regulatory responsibilities concerning cryptocurrencies.
Uniswap claims that if this legislation were to pass, the CFTC would be given more enforcement power in some sectors, and the SEC’s action might be moot.
According to Ammori, Uniswap got the Wells Notice in April. He expressed disappointment but did not seem surprised. Further, he criticized the SEC for not clarifying and directing Uniswap’s self-custodial, non-intermediated products.
In March of last year, Coinbase was also served with a Wells Notice, which prompted formal legal action. In the meantime, the trading platform Robinhood is scheduled to face legal action from the SEC in May.
