As regulatory worries grow, synthetic tokens and tokenized stocks have been added to Uniswap Labs’ blacklist of prohibited items.
Uniswap, the world’s largest decentralised exchange, has announced the delisting of several tokens from its app interface, effective immediately.
According to Uniswap Labs, the notification was published on July 23 and stressed that the tokens had only been removed from the app interface and that the protocol itself had not been changed:
“These changes pertain to the interface at app.uniswap.org — the Protocol remains entirely autonomous, immutable, and permissionless.”
The software developer Uniswap Labs is responsible for the development of the front-end web application site. In contrast to the Uniswap protocol itself, which is an independent code that has been made available as a public good, the front-end is a separate component.
It was intimated in the blog post that rising regulatory pressure may have had an impact on the company’s decision, noting that “we are keeping an eye on the evolving regulatory landscape.” According to the business, this decision was also defined as “consistent with actions taken by other DeFi interfaces,” according to the business.
The tokens that have been removed from the platform’s interface include instruments that may be deemed securities by a regulatory authority, such as tokenized stocks, options tokens, insurance-based tokens, and synthetic assets from crypto derivatives platforms such as Synthetix, among others.
One of the assets targeted is the gold-backed token Tether Gold (XAUT). However, Uniswap founder Hayden Adams believes that XAUT’s removal was due to a flaw in the software. Several meme-themed tokens, such as Grumpy Cat (GRUMPY), had also made their way onto Uniswap’s banned items list.
The alleged decentralisation of Uniswap was called into question as a result of the reaction from the crypto community. Industry analysts, including Twitter user @ChainLinkGod, questioned why UNI holders were not allowed to vote on the delistings.
“Not very informative here. Was this decision made through a governance vote? If not, this opens a whole can of worms and sets a terrible precedent.”
As of this writing, Uniswap is the most active decentralised exchange in terms of trading volume, with its v2 and v3 versions of the protocol facilitating a total of $1.45 billion in transactions in the last 24 hours.
Regulatory pressure on the cryptocurrency business is increasing across the world, with cryptocurrency exchanges Binance and BlockFi most recently suffering the wrath of regulators in the United Kingdom and the United States, respectively.
According to a storey published on July 22 by Cointelegraph, the Texas State Securities Board has joined its equivalents in New Jersey and Alabama in pursuing action against the cryptocurrency lending site.
On July 25, Vermont became the fourth state to impose an injunction against BlockFi, following California, New York, and Pennsylvania.