In summary
- US regulator the Commodity Futures Trading Commission (CFTC) has sanctioned Uniswap Labs for allegedly illegally offering leveraged or margined commodity transactions in digital assets.
- The order requires Uniswap Labs to pay a civil penalty of $175,000 and immediately cease and refrain from violating the Commodity Exchange Act (CEA).
- Uniswap Labs’ Chief Legal Officer Katherine Minarik said the company remains focused on building the future of DeFi and fighting the battles necessary to make that happen.
The US regulator, known as the Commodity Futures Trading Commission (CFTC), has sanctioned Uniswap Labs, the company behind the decentralized Ethereum exchange Uniswap, with an order for allegedly illegally offering leveraged or margined commodity transactions in digital assets.
The order, which the regulator said was settled, requires Uniswap Labs to pay a civil penalty of $175,000 and immediately cease and refrain from violating the Commodity Exchange Act (CEA).
“Today, Uniswap Labs settled a CFTC investigation into a small fraction of a percent of trading across our interface related to a handful of tokens for a $175,000 fine in a standard no-admit-no-deny agreement,” Katherine Minarik, Chief Legal Officer at Uniswap Labs told Decrypt. “We remain solely focused on building the future of DeFi for everyone and fighting the battles necessary to make that happen.”
Ian McGinley, CFTC’s Director of Enforcement, said in the regulator’s statement that “DeFi operators must be vigilant to ensure that transactions comply with the law.”
Uniswap is a platform that allows people to trade cryptocurrencies. Unlike centralized exchanges like Coinbase or Binance, it is a decentralized exchange (DEX)—a platform that anyone can use to trade coins and tokens without a middleman—and it runs on the second-largest Cryptocurrency network, Ethereum. It is also powered by autonomous smart contracts, which contain the code that enables decentralized applications (dapps).
According to data from CoinGecko, it is the largest DEX in the crypto space, with a current trading volume of $888 million over the past 24 hours.
The price of Uniswap’s UNI token fell nearly 2% in the hour following the CFTC announcement before climbing back up. CoinGecko shows the asset is now trading for $6.45, after a nearly 8% increase over the past 24 hours.
This isn’t the first time Uniswap has fallen into a regulator’s crosshairs: In April, the Securities and Exchange Commission issued a Wells Notice to the platform after investigating it for years. A Wells Notice is sent when the regulator intends to take legal action against a company or individual.
Then, in May, Uniswap Labs defended itself before the regulator, claiming the SEC’s legal arguments were “weak” and an “effort to expand its jurisdiction beyond exchanges to communications technology, and beyond securities to all markets.”
Editor’s note: This story was updated after publication with additional details.
Edited by Andrew Hayward
Daily Debrief Newsletter
Start every day with the top news stories right now, plus original features, a podcast, videos and more.
For the Latest Crypto News, Follow ©KeynoteUSA on Twitter Or Google News.
Disclaimer: Please note that the information provided on this page is for News purposes only and should not be considered investment or trading advice. ©Crypto.keynoteusa.com strongly recommends that you conduct independent research and/or consult with a qualified professional before making any investment decisions.
