The U.S. Securities and Exchange Commission (SEC) has sent letters to several venture capital (VC) firms over their links to the operator of the Ethereum (ETH)-based decentralized exchange Uniswap, according to a report by online publication Axios.
Citing multiple sources, Axios says that the SEC has sent letters to Andreessen Horowitz, Union Square Ventures and other VC firms over their links to Uniswap Labs.
According to the online publication, VC firms have poured more than $170 million into Uniswap Labs since inception. The crypto-focused subsidiary of Andreessen Horowitz, a16z Crypto, lists Uniswap on its portfolio of investments. Uniswap is also listed as one of Union Square Ventures’ unicorn investments by venture capital data website VC Sheet.
The report about SEC’s correspondence with Uniswap Labs’ backers comes about four months since the US markets regulator sent a Wells Notice to the Ethereum-based decentralized exchange. A Wells Notice is typically issued when the SEC is probing an entity for potential violation of securities laws.
In response to the SEC’s Wells Notice, Uniswap Labs’ chief legal officer Marvin Ammori argued that the markets regulator’s argument that the decentralized exchange violated US securities laws was “weak and wrong.”
“…a token is merely a file format–like a PDF or JPEG. Tokens can represent any value, and overwhelmingly represent commodities (BTC, ETH, stables) & memes & access for useful networks. PDFs are not inherently stock certificates, and tokens are not inherently securities.
Even if securities were involved, the Uniswap protocol (and web app, and wallet) don’t fall under definitions of the ‘securities exchange’ or ‘broker.’
Under law, the Uniswap protocol would have to be specifically designed ‘for’ ‘securities’ – and it is not. It is for general purposes, mainly used for commodities.”
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