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  • L Misthos and S Pettigrove

SEC issues Wells Notice to Uniswap




The Securities and Exchange Commission (SEC) has issued a Wells Notice to Uniswap Labs, the developer of the decentralised cryptocurrency exchange, Uniswap.


A Wells Notice is issued by the SEC to inform a person or entity that it has concluded an investigation and intends to bring charges for securities violations. The receipient is typically given an opportunity to file final submissions explaining why charges should not be brought against them. The issuance of a Wells Notice is typically followed by enforcement action.


According to Uniswap's Chief Operations Officer, Mary Catherine Lader, the contents of the Wells Notice centre around Uniswap acting as an unregistered securities broker and an unregistered securities exchange. It is not immediately clear whether the allegations also relate to the exchange’s governance token, UNI.


Uniswap's Chief Executive Officer, Hayden Adams took to X announcing that Uniswap was "ready to fight" the SEC should it pursue enforcement action.

I am confident that the products we offer are legal and that our work is on the right side of history.
But it’s been clear for a while that rather than working to create clear, informed rules, the SEC has decided to focus on attacking long-time good actors like Uniswap and Coinbase. All while letting bad actors like FTX slip by.

The SEC has pursued a long running regulation by enforcement strategy asserting that existing securities laws are clear, and token issuers and exchanges should “come in and register”. However, there is no clear path for most crypto businesses to register with the SEC. Attempts to register have met with little success and have been often followed by enforcement action. The SEC’s own commissioners have made this point in several stinging dissents, including Hester Pierce’s recent dissent in the ShapeShift settlement.


Mr Adams added:

I'm frustrated that the SEC seems to be more concerned with protecting opaque systems than protecting consumers. And that we'll have to fight a US government agency to protect our company and our industry.
This fight will take years, may go all the way to the Supreme Court, and the future of financial technology and our industry hangs in the balance. If we stand together we can win. I think freedom is worth fighting for. I think DeFi is worth fighting for.

In a blog post, the company stated:

Despite SEC rhetoric that "most" tokens are securities, the reality is that tokens are a digital file format, like a pdf or spreadsheet, and can store many kinds of value. They are not intrinsically securities, just as every sheet of paper is not a stock certificate.

Hayden Adams invented the Uniswap Protocol as an experiment to build software that embodied the benefits of the decentralized Ethereum blockchain. Accordingly, Uniswap is often viewed as a pioneer of decentralised and permissionless software applications. The company has openly carried on operations in the United States despite legal uncertainty in recent years. While the SEC’s action is likely only the first step in a battle for the future of DeFi, it is likely to have a chilling effect on blockchain based innovation in the United States.


By Michael Bacina, Steven Pettigrove and Luke Misthos

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