Recent developments in the cryptocurrency industry have sparked a notable decrease in trading activity on the Uniswap decentralized exchange. Following the issuance of a Wells notice by the US Securities and Exchange Commission (SEC) to Uniswap Labs, the entity behind the exchange, trading volume on Uniswap dipped by almost 10% in just one day. This event has raised concerns among investors and market participants about the future of the platform.
Data from DeFillama revealed that Uniswap’s facilitated trades amounted to a substantial $2.7 billion across various blockchain networks, such as Ethereum, Arbitrum, Coinbase-backed Base, and others. However, the majority of the decline in trading activity was observed on Uniswap V3, the most widely used version of the decentralized trading platform. Despite this setback, Uniswap recently achieved a monumental milestone by surpassing $2 trillion in total trading volume.
The news of the SEC action had a significant impact on Uniswap’s native UNI token, causing it to plummet to a multi-week low of $9.09, according to data from CryptoSlate. Additionally, blockchain sleuth Lookonchain reported that three whales offloaded a combined total of 2.03 million UNI tokens valued at $20 million to centralized exchanges following the announcement. While two addresses deposited large amounts of UNI on Binance but have not yet sold, another whale sold 472,691 UNI for $4.59 million USDC, generating a profit of $1.67 million.
Mavin Ammori, the Chief Legal Officer at Uniswap Labs, expressed the company’s preparedness to challenge any potential lawsuit initiated by the SEC. Ammori refuted the SEC’s allegations, highlighting that the regulator’s jurisdiction is limited to securities and does not extend to assets defined by specific file formats or technical standards. He emphasized that most tokens, including Bitcoin, Ethereum, stablecoins, and meme coins, do not meet the criteria to be classified as securities. Ammori underlined Uniswap Labs’ advocacy for sensible regulations in the crypto industry, advocating for clear guidelines rather than arbitrary enforcement by regulatory bodies.
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