SEC Closes Investigation into Uniswap Labs
The US Securities and Exchange Commission (SEC) officially closed its investigation into Uniswap Labs without taking enforcement action, according to a recent statement.
Background
- The investigation began over three years ago.
- Allegations included operating as an unregistered broker, exchange, and clearing agency.
- Uniswap Labs was also accused of issuing an unregistered security.
Uniswap Labs hailed the outcome as a victory for decentralized finance (DeFi), highlighting that decentralized technology operates within the legal framework.
In April, the SEC issued a Wells notice outlining potential charges, but no further legal action is planned after the investigation concluded this week.
Jake Chervinsky, chief legal officer at Variant Fund, congratulated Uniswap on the outcome, criticizing the regulatory overreach faced by major crypto players.
Following the news, Uniswap’s governance token UNI saw a 5% increase in value based on CryptoSlate data.
Regulatory Implications
Throughout the investigation, Uniswap Labs maintained that it does not operate as a broker, and UNI is not a security under US securities law.
Founder Hayden Adams criticized the SEC’s approach, noting a lack of clear legal grounding for regulatory enforcement on DeFi projects.
Adams argued that applying traditional regulatory frameworks to decentralized networks fails to recognize their structural differences.
“This is a huge win, not just for Uniswap Labs but for DeFi as a whole.”
He highlighted the transparency provided by self-custodied funds and smart contracts in public blockchains, making traditional regulatory approaches unsuitable for DeFi.
Adams emphasized the financial and operational burden the investigation placed on the company and stressed the need for tailored regulatory rules for DeFi.
He expressed optimism about collaborating with Congress and regulatory bodies to establish clear guidelines while promoting transparency, access, and innovation in decentralized financial technologies.
