The Commodity Futures Trading Commission (CFTC) has filed charges against the company that runs Uniswap (UNI) for allegedly offering illegal cryptocurrency derivatives contracts.
The regulator said in a new press release that it has imposed a civil penalty of $175,000 and issued a cease and desist letter to Uniswap Labs after it was found to have violated the Commodity Exchange Act (CEA).
According to regulators, Uniswap Labs was never properly registered as a contract marketplace, but was operating as if it were.
“Among the digital assets traded via the protocol and interface, there were a limited number of leveraged tokens, which provided users with leveraged exposure to digital assets such as Ether and Bitcoin.
This order finds that these leveraged tokens are leveraged or margined products that do not result in actual delivery within 28 days, and therefore may only be offered to ineligible contract participants on exchanges that have been designated or registered by the CFTC as contract markets, which Uniswap Labs did not do.”
According to a press release, Uniswap Labs’ fine was reduced due to its cooperation with the CFTC’s investigation.
As Ian McGinley, CFTC’s chief enforcement officer, put it:
“Today’s action once again demonstrates that the Department will vigorously enforce the CEA as digital asset platforms and the DeFi ecosystem evolve. DeFi operators must be vigilant to ensure that their transactions comply with the law.”
Earlier this year, the U.S. Securities and Exchange Commission (SEC) also sent out a Wells Notice, a notice that the regulator intends to take enforcement action against the company.
At the time of writing, Uniswap is trading at $6.36, up 5% over the last 24 hours.
Don’t miss out – subscribe to receive email notifications straight to your inbox
Price check task
Follow us XFacebook and Telegram
Surfing the Daily Hodl Mix
 
Disclaimer: The opinions expressed on The Daily Hodl are not investment advice. Investors should do their own due diligence before making any high-risk investment in Bitcoin, cryptocurrencies or digital assets. Your transfers and transactions are at your own risk and any losses you may incur are your own responsibility. The Daily Hodl does not recommend buying or selling cryptocurrencies or digital assets and The Daily Hodl is not an investment advisor. The Daily Hodl participates in affiliate marketing.
Generated image: Midjourney