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Top DeFi business Uniswap Labs is apparently being investigated by the United States Securities and Exchange Commission [SEC] in yet another incidence of regulatory resistance.
As reported by The Wall Street Journal, “people familiar with the matter” stated that the watchdog is looking into how investors utilize the world’s largest decentralized cryptocurrency exchange, how it is marketed, and its operational procedures.
The investigation is said to be in its early stages right now and may not result in formal prosecution yet. Speaking to the Journal, a Uniswap spokesperson claimed,
“… the firm is committed to complying with the laws and regulations governing our industry and to providing information to regulators that will assist them with any inquiry.”
Just as DeFi adoption in the USA has skyrocketed over the past year, American regulators have begun to show a great deal of interest in regulating the space. Last month, SEC Chief Gary Gensler had claimed that the agency could regulate DeFi projects, especially the ones that reward participants with valuable tokens or similar incentives.
He had also opined that while these platforms might be decentralized in some ways, they might be highly centralized in others.
Earlier that month, he had called on the U.S Congress to grant the agency more authority to better police cryptocurrency trading and lending platforms, along with the power to oversee crypto-exchanges, which it otherwise couldn’t. More particular, he intended to obtain control of crypto-lending and platforms such as peer-to-peer decentralised exchanges.
It should also be mentioned that some critics of the Infrastructure Bill feel that its crypto-provisions were inserted solely to acquire more control over the DeFi space. If laws begin to bite in the DeFi arena, DEXs like Uniswap may be obliged to comply with new reporting obligations for participants.