Uniswap receives SEC lawsuit warning, CLO describes it as 'another abuse of power'

Quick Take

Uniswap received a Wells Notice, or formal notice of a potential lawsuit, from federal regulators on Wednesday.

Uniswap Labs has received a warning that federal regulators will bring a lawsuit against it, the protocol's founder said Wednesday on X.

The Securities and Exchange Commission sent Uniswap Labs, the organization that developed the eponymous decentralized finance (DeFi) protocol, a Wells Notice on Wednesday. A Wells Notice is a formal notice that the SEC intends to bring charges against a respondent. The move comes amid a broader regulatory crackdown on DeFi, viewed by some as the unruly sector of an industry the SEC chairman once referred to as the "Wild West."

“It’s been clear for a while that rather than working to create clear, informed rules, the SEC has decided to focus on attacking long-time good actors like Uniswap and Coinbase,” Uniswap founder Hayden Adams said Wednesday in a post on X.

“I’m not surprised," he added. “Just annoyed, disappointed, and ready to fight [the charges].”

Uniswap is the largest decentralized exchange (DEX) by daily trading volumes, processing 22.5% of trading volume, according to CoinGecko's data. Its targeting by regulators comes roughly a year after its competitor SushiSwap was subpoenaed.

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