Uniswap Labs Calls on SEC to Reconsider DeFi Regulatory Approach
Date: 2024-07-10 Author: Oliver Abernathy Categories: BUSINESS
Uniswap Labs has urged the US Securities and Exchange Commission (SEC) to abandon its attempts to regulate the decentralized finance (DeFi) sector. Uniswap's move follows a recent US Supreme Court decision that limits the powers of federal agencies, including the SEC.
In its appeal, Uniswap Labs refers to the Supreme Court's decision to overturn the Chevron doctrine. The doctrine previously gave federal agencies broad discretion to interpret controversial laws. The doctrine's repeal means that courts are no longer required to follow agency interpretations when reviewing such laws. Uniswap believes that this decision should serve as a signal for the SEC to reconsider its plans to regulate DeFi.
SEC Attempts to Expand Definition of "Exchange"
Since April 2023, the SEC has been actively trying to expand the definition of “exchange” to include DeFi protocols. The SEC recently provided additional information and opened a comment period on proposed changes to its definition. Uniswap Labs believes that such attempts by the SEC only lead to unnecessary waste of resources and do not contribute to effective regulation of the sector.
In a statement, Uniswap Labs said: “The Supreme Court's decision in Loper Bright confirms that the Commission should refrain from adopting the proposed amendments.” The company believes that continuing to attempt to regulate DeFi will only distract the SEC from more important tasks and waste the agency's limited resources.
History of the Conflict
Let us recall that on April 10, 2024, the SEC already warned the decentralized exchange Uniswap about a possible lawsuit. This move by the SEC was the latest episode in the ongoing struggle between the regulator and the DeFi sector. Uniswap Labs is confident that such actions from the SEC only complicate the development of innovative financial technologies and hinder their integration into the existing financial system.
Uniswap Labs' appeal to the SEC highlights the need to reconsider approaches to regulating decentralized finance. With the Chevron Doctrine rescinded and ongoing dialogue between regulators and market participants, the future of DeFi will depend on how wisely and balanced regulatory decisions are made.
