Uniswap Labs has issued a defiant response to the SEC’s Wells discover, asserting the company’s makes an attempt to control DeFi are misguided and legally unsound.
The corporate stated in a Could 20 weblog publish that it’s assured it can come out victorious if pressured into litigation by the SEC. Uniswap Labs stated:
“We’re assured that our work is on the correct facet of historical past. The SEC mustn’t commit its taxpayer-funded assets to bringing a case in opposition to us.”
The response comes amid a broader conflict over the way forward for monetary know-how and market regulation.
Legally unsound
Uniswap Labs criticized the SEC’s efforts to broaden its jurisdiction over communications know-how and digital markets, claiming the company’s authorized arguments are weak and have been repeatedly refuted in courtroom.
The corporate stated:
“We consider the SEC ought to embrace open-source know-how that improves on outdated industrial and monetary programs as an alternative of making an attempt to litigate it out of existence.”
It additionally highlighted that the Uniswap Protocol aligns with the SEC’s mission to guard buyers and preserve honest, orderly, and environment friendly markets.
Uniswap Labs defended the Uniswap DEX as a significant market innovation that has enabled customers to transact instantly with out counting on centralized intermediaries. It added that the protocol — which operates autonomously and has facilitated $2 trillion in buying and selling quantity with out a single hack — presents clear, low-cost, and environment friendly buying and selling accessible globally 24/7.
Akin to a PDF file
In its full Wells response, Uniswap Labs rejected the SEC’s assertions that the protocol is an unregistered securities change and that the UNI token constitutes an funding contract.
It argued that the ERC-20 token normal it helps is a “basic file format for all types of worth.”
The corporate acknowledged:
“A token is a file format, like a PDF. The Protocol is a basic goal laptop program that anybody can use and combine, like TCP/IP.”
Uniswap Labs added that, even when the SEC is appropriate that some securities transactions happen on its protocol, the protocol is “nearly solely used for non-securities transactions” involving Ethereum, wrapped Bitcoin, stablecoins, and memecoins.
The SEC has argued that Uniswap is an change managed by Uniswap Labs and that its interface acts as an unregistered broker-dealer.
Nevertheless, Uniswap Labs argues that the SEC’s place relies on incorrect assumptions and contends that these claims wrongly equate a digital file format with a safety.
The corporate stated the UNI token was airdropped to hundreds of customers with out the expectation of revenue from the DEX’s efficiency, which means that it doesn’t meet the factors required by the Howey Take a look at.
Uniswap assured in victory
Uniswap Labs CLO Marvin Ammori expressed confidence in Uniswap’s stance, stating on X:
“We’ve a really robust case. If pressured to litigate, we’ll win.”
He asserted that Uniswap Labs’ case is “so robust that the SEC is attempting to vary the regulation.” Along with describing the file codecs argument, Amorri stated the SEC is working to redefine “change” and different phrases past their present that means.
He stated that courts have dismissed comparable arguments in opposition to Coinbase by discovering that self-custodial wallets don’t meet the necessities to be a dealer.
Uniswap Labs has employed attorneys who’ve gained two high-profile circumstances, together with former SEC enforcement head Andrew Ceresney and former US Solicitor Basic Don Verrilli.
The 2 attorneys represented Ripple and Grayscale in opposition to the SEC, respectively.
The SEC issued a Wells discover to Uniswap Labs on April 10, which indicated that the SEC’s Enforcement Division supposed to suggest a lawsuit in opposition to the agency.
In latest weeks, the SEC has additionally filed Wells notices in opposition to the Ethereum growth agency Consensys and the retail brokerage Robinhood.
The SEC has not but initiated the anticipated lawsuits in opposition to the three corporations. Consensys alone has responded with a preemptive lawsuit.
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