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Uniswap challenges the SEC’s Wells notice, arguing that legal action isn’t the solution

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Uniswap challenges the SEC's Wells notice

In response to the SEC Wells notice, Uniswap Labs argues against enforcement. On Tuesday, Uniswap described why the SEC should not sue in a 43-page filing.

As a non-traditional exchange, Uniswap claimed that the SEC cannot control bitcoin, ether, or stablecoins, its principal trading assets. Uniswap calls these assets stablecoins, utility tokens, and commodities, not securities.

Uniswap noted its decentralization, not maintaining user accounts or collecting personal data. Uniswap claims this arrangement hinders SEC openness and monitoring.

Uniswap predicted that SEC lawsuit will drive American users to overseas platforms, complicating regulation and inhibiting innovation.

“Bringing this case would encourage Americans to use harder-to-regulate foreign interfaces,” Uniswap said, emphasizing financial industry innovation.

Uniswap suggested that Congress, not the SEC, should regulate crypto. The corporation said the SEC “cannot achieve its goals through litigation.”

Other crypto businesses like ConsenSys sued the SEC after getting a Wells notice. ConsenSys alleges the SEC overstepped its jurisdiction and failed to offer clear Ethereum and ether standards.

Robinhood is under SEC inquiry after receiving a Wells warning about its crypto activities. Robinhood foresaw civil and administrative lawsuits.

Wells notifications for Uniswap and Robinhood have not been remarked on by the SEC. This lack of clarity makes the crypto business, which wants clearer regulations, uneasy.

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James Wilson is a crypto writer and researcher with over 5 years of experience in the industry. He is a graduate of the University of California, Berkeley, where he studied computer science and economics. After graduating, he worked as a software engineer at a major tech company before transitioning to a career in crypto.