Uniswap received a Well Notice from the U.S. Securities and Exchange Commission (SEC) in early April, indicating that it may face regulatory litigation. However, Uniswap Labs responded to the Well Notice issued by the SEC yesterday, stating that the UNI token is merely a file format and Uniswap is just a computer program, thus refuting the SEC’s viewpoint.
Uniswap Labs believes that the SEC should embrace open-source technology that can improve business and financial systems, rather than stifling it through litigation. They also assert that Uniswap is a secure, low-cost, and transparent infrastructure that can “protect investors and maintain fair, orderly, and efficient markets.” However, the SEC is attempting to stifle a project that is fulfilling the SEC’s mission.
Regarding the Well Notice, the SEC claims that the Uniswap protocol is an unregistered securities exchange controlled by Uniswap Labs, the Uniswap interface is an unregistered securities broker-dealer, and the UNI token is an investment contract. However, Uniswap Labs states in the article that the UNI token and the Uniswap protocol are simply file formats and computer programs, thereby refuting the SEC’s characterization of the UNI token as a security.
According to reports, Martin Ammori, the Chief Legal Officer of Uniswap Labs, stated yesterday that the SEC must redefine what constitutes an exchange in order to have jurisdiction over Uniswap. According to the current definition of an exchange, Uniswap would have to be designed to only trade securities. However, 65% of the current trading volume on Uniswap consists of non-security tokens such as Bitcoin, Ethereum, and stablecoins.
Furthermore, Martin Ammori also stated that based on a recent ruling by a federal court, which rejected the SEC’s allegations that the Coinbase wallet constituted an unregistered securities broker-dealer, it can be inferred that the SEC’s allegations against the Uniswap interface and wallet as unregistered securities broker-dealers may also fail.
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