Uniswap (UNI) is mounting a strong defense against the U.S. Securities and Exchange Commission (SEC) in their ongoing battle. As the largest decentralized exchange in terms of trading volume, Uniswap received a Wells Notice from the SEC last month, indicating that the regulator intends to take enforcement actions against the DEX in the near future. However, Uniswap Labs, the project behind the exchange, has responded to the SEC with an official statement submitted on Tuesday.
Marvin Ammori, the chief legal officer at Uniswap Labs, is leading the charge and challenging the SEC’s assumptions. He argues that the SEC is operating under the false assumption that nearly all crypto assets are securities. According to Ammori, tokens are simply file formats, similar to PDFs or JPEGs, and can represent various values. He emphasizes that tokens overwhelmingly represent commodities like Bitcoin (BTC), Ethereum (ETH), stablecoins, as well as memes and access to useful networks. Just as PDFs are not inherently stock certificates, tokens are not inherently securities.
Even if securities were involved, Ammori asserts that the Uniswap protocol, web app, and wallet do not fall under the definitions of a “securities exchange” or a “broker.” He claims that under the law, the Uniswap protocol would have to be specifically designed for securities, which it is not. Instead, it serves general purposes and is primarily used for commodities.
Ammori also highlights that current U.S. law mandates securities exchanges to be operated by “groups.” However, Uniswap is an “autonomous software” that is not operated or controlled by any individual or entity. This further supports Uniswap’s case against the SEC.
Confident in their position, Ammori states that the SEC is attempting to change the law to target Uniswap. He reveals that the SEC has proposed a rulemaking to redefine terms like “exchange” and “group” beyond their actual meanings. Uniswap believes that this tactic of changing the definitions of words in order to sue them under a newly created law will not hold up in court.
It is worth noting that the SEC has also taken legal action against other major exchanges, including Coinbase, Binance, and Kraken, for alleged violations of securities laws.
Uniswap’s fight against the SEC is intensifying, and it remains to be seen how this battle will unfold. Investors should exercise caution and conduct their own research before engaging in high-risk investments in Bitcoin, cryptocurrency, or digital assets.
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