US regulatory bodies are targeting crypto firms, including Uniswap; there is a delay in a decision on an eco Bitcoin ETF.
A recent enforcement action in the United States has heightened the scrutiny of decentralized finance (DeFi) protocols, primarily within a regulatory gray zone.
Regulators once more targeted the decentralized trading platform Uniswap for allegedly facilitating illicit derivatives trading. Uniswap has been ordered by the Commodity Futures Trading Commission (CFTC) to cease the alleged violations and has been issued fines. The action indicates the growing regulatory emphasis on DeFi front ends as authorities endeavor to ensure that current financial regulations follow protocols.
CFTC Charges Uniswap with Illegal Derivatives Trading
The CFTC has filed charges against Uniswap, alleging that the decentralized exchange facilitated unlawful derivatives trading. The allegations assert that Uniswap violated US commodity trading regulations by permitting users to trade unregistered derivatives products.
The protocol developer will be required to pay a civil penalty of $175,000 and cease any activities that may infringe upon the Commodity Exchange Act. The case is a significant step by regulators to enforce existing laws on DeFi platforms, which raises concerns about the potential for decentralized initiatives to navigate legal frameworks in the future.
SEC and Ripple reach an agreement
The SEC and Ripple Labs have agreed to postpone imposing a $125 million sanction on Ripple in response to the legal dispute between the regulator and the cryptocurrency company. The court ruling established XRP’s status as a non-security in specific circumstances, and this stay could pave the way for an appeal by the SEC.
Ripple has deposited 111% of the judgment amount, approximately $139 million, into a bank account in anticipation of the resolution of any appeals. The court’s sanction of this agreement is currently awaited by both parties, which could potentially prolong the legal proceedings that commenced in 2020.
The decision regarding the eco-friendly Bitcoin ETF has been postponed by the US regulator once more
The Securities and Exchange Commission (SEC) has once more delayed its decision regarding an exchange-traded fund (ETF) that would integrate spot Bitcoin with carbon credit futures. The ETF, which Tidal Investments initially filed, is designed to provide exposure to Bitcoin and mitigate carbon emissions through futures linked to emission allowances in the European Union and California.
The SEC has extended the decision deadline to Nov. 21, 2024, which is consistent with the ongoing trend of regulatory hesitancy regarding financial products that are particularly eco-friendly.
The SEC has indicated that it may initiate a challenge to the repayment plan for FTX crypto.
The SEC has warned that it may challenge payments made to creditors of the defunct crypto exchange FTX if the exchange elects to return funds using stablecoins.
The Securities and Exchange Commission (SEC) attorneys stated in an August 30 filing that, although creditor repayments made with stablecoins may not be technically illegal, they reserve the right to challenge repayments made with crypto assets pegged to the US dollar.
FTX’s most recent liquidation plan has agreed to pay out creditor claims in cash or with stablecoins based on the US dollar value of asset prices at the time of the exchange’s bankruptcy. However, many creditors have requested in-kind payments.
