UNISwap’s “whale” users seem concerned, as they have been transferring tokens out of the platform following news that Uniswap received a warning from the US Securities and Exchange Commission (SEC) about potential regulatory action.
Following the development, UNI’s price tumbled to $9.27, extending its monthly losses to over 35%.
UNI Whales Sell Tokens
The news led to a large-scale selling of UNI tokens by three significant investors, totaling about 2.03 million units worth around $20 million. This action resulted in a substantial 17% drop in UNI‘s price over the last day, reaching its lowest point in the past two months.
Among the listed whale accounts, 0x2F8b and 0x3555 rapidly transferred 1.25 million UNI tokens, equivalent to approximately $11.7 million, from Binance into the exchange. Based on current market prices, they could potentially earn a profit of around $3.5 million if they decide to sell. (Source: Lookonchain’s recent analysis)
0x4A0B sold off 472,691 UNI tokens for approximately $4.59 million in USDC, with each UNI token being worth around $9.71 at the time. This transaction resulted in a profitable gain of roughly $1.67 million. Meanwhile, six different wallets transferred a combined total of 316,430 UNI tokens, equivalent to around $3.16 million, into Binance.
After the Securities and Exchange Commission (SEC) notified Uniswap Labs, the organization managing the largest decentralized exchange, that it intends to take enforcement action, there was a massive sell-off instigated by the whales (large investors).
The reason why the SEC issued a notice about Uniswap is unclear at this time, but it seems consistent with the regulatory body’s efforts to apply securities laws to American businesses dealing in cryptocurrencies, including Coinbase and Binance.
Uniswap declared in an announcement that its protocol, website, and related wallet system don’t fit the legal descriptions of a securities exchange or broker. This viewpoint was supported in the SEC vs. Coinbase case, where the judge quickly dismissed the SEC’s argument that cryptocurrency wallets should be considered brokers, despite charging fees.
Uniswap emphasized that the UNI token doesn’t fit the description of a security based on legal standards. They explained that the UNI token fails to meet the requirements of an “investment contract.”
Unswap Founder Ready to Fight
Hayden Adams, the founder of Uniswap, expressed his frustration and disappointment but is prepared to defend. In a playful dig at the SEC, Adams stated that Uniswap excels more in ensuring investor protection, maintaining orderly markets, and fostering capital formation compared to the regulatory body itself.
The founder expressed his disappointment with the SEC’s focus on complex financial systems over consumer safety and vowed to fight for both Uniswap and the decentralized finance (DeFi) sector against regulatory interference. This battle, which might extend all the way to the Supreme Court, could be a prolonged legal conflict.
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2024-04-11 15:40