Uniswap Vows to Fight SEC Enforcement Action, Backs Legislative Reform for DeFi Regulation

Uniswap Labs, the developer behind the decentralised exchange Uniswap, has issued a defiant response to the United States Securities and Exchange Commission (SEC) after receiving a Wells notice, indicating a potential enforcement action. In a blog post on May 21, Uniswap characterised the SEC's legal arguments as "weak" and expressed readiness to contest the matter in court if necessary, citing successful representation of firms like Grayscale and Ripple by its legal team. The company emphasised its belief that the SEC's case is flawed, particularly in its treatment of all tokens as securities, and asserted its preparedness to fight against any potential enforcement action. Notably, Uniswap's response coincided with the impending vote in the U.S. House of Representatives on the Financial Innovation and Technology for the 21st Century Act, which could impact how crypto is regulated by the SEC and the Commodity Futures Trading Commission (CFTC). Uniswap suggested that if the legislation passes, granting the CFTC specific enforcement authority, the SEC's case against it could be rendered moot. The SEC's enforcement action against Uniswap comes amidst speculation regarding the regulator's consideration of Ether's classification as a security, a decision that could influence the approval or denial of spot Ether exchange-traded funds (ETFs) for listing and trading on U.S. exchanges by May 23. Uniswap facilitates automated token exchanges on the Ethereum blockchain.