Decentralized finance involving cryptocurrencies and tokens is a very interesting software frontier, and not something that governments or bankers want to see succeed. You can learn more about Uniswap on from their Wikipedia page.

https://www.axios.com/2024/09/04/uniswap-labs-regulators-cftc

By Brady Dale

A man speaking in an official setting, with a few people blurry in the background. — Rostin Behnam, chairman of US Commodity Futures Trading Commission (CFTC), speaks during a House Agriculture Committee hearing in Washington, DC. Photo: Valerie Plesch/Getty Images

Uniswap Labs, the firm behind the world’s most popular decentralized exchange, is under fire from a variety of regulators.

Why it matters: If regulators want to throw a giant monkey wrench into the crypto economy, making people afraid to use Uniswap would be a great way to do it.

Driving the news: Uniswap Labs today agreed to a $175,000 settlement with the CFTC, while some of its chief investors received subpoenas from the New York Department of Financial Services.

The CFTC settlement concerned trading for various tokens that represent leveraged trades on leading crypto assets, such as bitcoin (BTC) and ETH.
This all comes after the SEC previously served Uniswap Labs with a Wells Notice, which indicates that it’s likely to take legal action.

Catch up quick: Uniswap has been, arguably, the most successful project in the world of decentralized finance, with nearly $3 trillion worth of cryptocurrency trades taking place over the exchange over the life of the project.

Notably, the exchange cannot be shut down. It exists as immutable smart contracts on various blockchains.

The intrigue: The CFTC settlement explicitly refers to ether (ETH) as a commodity.

SEC Chair Gary Gensler has declined to do the same, which could be a breadcrumb for a future lawsuit by his agency.

Go deeper: The SEC has questions for VCs about Uniswap (below)

The SEC has questions for VCs about Uniswap

By Dan Primack

Photo: Silas Stein/picture alliance via Getty Images.

Several venture capital funds, including Andreessen Horowitz and Union Square Ventures, have received letters from the SEC over their involvement with decentralized crypto exchange operator Uniswap Labs, per multiple sources.

The big picture: Uniswap Labs has raised over $170 million in VC funding, most recently in late 2022 at nearly a $1.7 billion valuation.

Catch up quick: The company received, and responded to, a Wells Notice earlier this year.

In short, it appears that regulators may accuse Uniswap of being an unregistered exchange.

Zoom in: A bit of irony is that Uniswap is less vertically integrated than is SEC bete noire Coinbase, in that it’s not really the broker.

Also worth noting that even if Uniswap Labs was shut down as a company, the actual Uniswap products would keep running.