The U.S. Securities and Exchange Commission (SEC) has issued a Wells Notice to Uniswap Labs, indicating the possibility of filing a lawsuit against them. Last March, Coinbase also received a Wells Notice and began a long-term litigation with the SEC. This article compiles the opinions of legal experts in the crypto industry regarding this event.
Uniswap Receives Wells Notice, Founder Vows to Fight SEC to the End
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Uniswap Users, Don’t Panic
Former SEC Executive: Uniswap’s Response is Terrible
Arguments Where SEC Could Lose
Uniswap Users, Don’t Panic
Bill Hughes, Senior Legal Advisor at Consenys, pointed out that the SEC would first need approval from five members of the Commission, including Gary Gensler, to file a lawsuit. However, based on the SEC’s internal vote on the Bitcoin ETF, this time there may only be two Commission members, such as Hester Peirce, who support the crypto industry, voting against the lawsuit. This suggests that the lawsuit may be a foregone conclusion (3:2). Bill Hughes still urges everyone not to panic because the SEC is highly unlikely to charge UNI holders or protocol users.
Former SEC Executive: Uniswap’s Response is Terrible
Former SEC Internet Enforcement Director, John Reed Stark, mentioned that institutions receiving Wells Notices usually have the opportunity to explain themselves to the SEC. He is not surprised that Uniswap received the notice, but he is surprised that these institutions often respond to the SEC with derogatory and insulting public statements, and Uniswap seems to be doing the same. He said, “Any SEC lawyer would agree that responding to a Wells Notice with insults is a weak and foolish strategy. One can expect SEC enforcers to submit a detailed and powerful accusation to the federal court and win in a typical summary judgment.”
Arguments Where SEC Could Lose
Gabriel Shapiro, former legal advisor at Delphi Labs, pointed out several possibilities. He believes that the SEC could win on the issue of “UNI as a security,” but if the SEC accuses Uniswap of being a “broker-dealer,” they could lose. Paul Grewal, Chief Legal Officer at Coinbase, also holds the same view. He cited a federal judge’s ruling in March, where the judge concluded that the SEC failed to provide evidence that Coinbase engaged in broker-dealer activities through Coinbase Wallet.
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John Reed Stark
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