Uniswap is struggling to emerge from the scrutiny of US regulators. It looks like the New York State Attorney General Letitia James is following the footsteps of the SEC chairperson Gary Gensler, when it comes to crypto. During the previous month, some venture capital firms who have invested in Uniswap received summons from James’ office. a16z also received such subpoenas. Uniswap is not the first crypto project Letitia is going after. She has previously gone after various crypto firms like CoinEx, KuCoin, and Genesis.
A Recent Penalty
Various regulators are putting heat on Uniswap. On September 4, the decentralized- finance giant, Uniswap received an order from CFTC to pay a fine of $175,000 as civil monetary penalty. This penalty came with the orders of cease and desist from violation of the Commodity Exchange Act. Authorities have charged Uniswap with offering illegal leveraged and margin commodities transactions
According to CFTC, Uniswap platform allows its users to trade in pairs not created by the platform itself and that exposes investors to high risk. Uniswap has not registered as a designated contract market with CFTC and hence not allowed to offer legarage trading products.
Multiple Regulators on Neck
Along with CFTC and NYAG, Uniswap is already in trouble with the SEC. In April this year, the platform received a Well Notice from the Security and Exchange Commission. The COO of Uniswap, Mary Catherin, shared information on this step by the SEC. She said that the Wells notice centered on Uniswap operating as an unregistered securities broker and exchange. However, it is still uncertain if Uniswap’s native token, UNI, was identified as a potential security in the SEC’s notice.
The Irony
The crypto ecosystem has been waiting for clear regulations for a long time. The projects and the investors are suffering the wrath of various regulatory bodies. Even though none of them have a clear guidance to share on how crypto projects should work. US regulatory authorities have been targeting the crypto industry for a long time. From Ripple to Coinbase and now Uniswap, all are getting punished without any clear guidlines.
These actions and penalties have increased especially after the collapse of FTX. The crypto people are now looking at the presidential elections going to happen in November in the hope. Everybody is hoping that the results of these elections might give rise to a crypto favorable government.
