US Commodity Futures Trading Commission has settled with Uniswap charges to the tune $175,000 early this morning.
However, two commissioners say that regulators shouldn’t have even brought this case.
Regulators claim Uniswap “illegally offered leveraged or margined retail commodity transactions in digital assets via a decentralized digital asset trading protocol.”
Summer K. Mersinger, CFTC commissioner Summer K. Mersinger released a dissenting view following the announcement of the settlement. She claimed that the case against Uniswap was not settled. “has all the hallmarks of what we have come to know as regulation through enforcement.”
Settlements are made in the end. “sweeping statements” About the crypto industry as a whole and how it employs “legal theories” Mersinger also said Mersinger was not limited to a courtroom environment.
Caroline Pham released a dissenting statement, asking how the CFTC could have made the accusations in the first instance, since there are no charges. “no evidence” Uniswap advertised a leveraged coin. The regulators seem to be unfairly targeting the decentralized financial sector, according to her.
“Applying the logic of the CFTC’s legal argument, it seems that any commercial transaction to purchase a cow, a bushel of oats or a barrel of oil that involves the word ‘financed’ and is delivered in 30 days is a violation of [commodities laws] and needs to be executed on a futures exchange,” Pham writes. “I am skeptical that the CFTC would try to enforce these statutory provisions outside of DeFi.”
This isn’t the first time that either Commissioner has voiced concern over how their agency handles digital assets.
Mersinger stated that Congress must clarify crypto regulations in October 2023, at the State of Crypto Event.
“Until we offer some sort of clarity, we’re going to see this activity…move away from the US,” “She said” “We could lose out on a lot of innovation and opportunities in our financial markets.”
Mersinger said that, at the moment, the enforcement teams of both the CFTC and US Securities and Exchange Commission are the ones who decide which cases should be brought and, therefore, make most rules.
Pham, in 2023, also expressed her dissatisfaction with the CFTC’s interpretations of commodity laws as they relate to cryptocurrency lending. She stated that “cautioned” Her fellow regulators are exceeding their legal authority.
Uniswap’s CFTC settlement comes months after the exchange received a Wells notice — a heads up that enforcement actions are incoming — from the SEC. In May, Uniswap argued, in response to regulators, that the SEC lacked the authority necessary to regulate bitcoins, ethers or stablecoins – the principal assets traded via the Uniswap platform.
Uniswap has also stated that the tokens on its platform, which are alternative assets to securities such as community tokens, stablecoins and commodity tokens (such as utility tokens), do not constitute securities. Uniswap also pointed out that — per its decentralized nature — the protocol does not maintain user accounts or collect personal data, complicating the SEC‘s push for increased transparency and regulatory oversight.
The SEC does not have any public announcements about charges brought against Uniswap or a possible settlement. Uniswap has not responded to Blockworks’ comment request.
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