United States’ SEC recently started an investigation against a start-up that operates the biggest decentralized crypto exchange in the world- Uniswap. The news was first reported by the Wall Street Journal.
The major financial news outlet outlines that the Securities and Exchange Commission is currently in the midst of investigating the exchange’s investor and marketing services.
As a response to the issue, a spokesperson from Uniswap revealed to some unknown news outlets that the company is “committed to complying with the laws and regulations governing our industry and to providing information to regulators that will assist them with any inquiry.” this sounds like a defensive statement.
Garry Gensler, the SEC Chair, was the one to initiate the investigation. He commented that decentralized finance (DeFi) projects are a source of concern for the agency, specifically because such exchanges offer rewards and incentives to users.
The investigation is currently at its initial stages. SEC did not confirm if it will press charges or not.
Uniswap is a decentralized crypto exchange. What this means is that the exchange is not overseen by a centralized authority, not unlike other major centralized cryptocurrency exchanges. More specifically, Uniswap is run by a so-called distributed network.
Uniswap is currently the biggest decentralized exchange in the world. It holds a trading volume of $1.5 billion in just 24-hours. The exchange is behind centralized companies but it has been reported that it is gaining popularity by the day.