Judge Overseeing SEC’s Coinbase Lawsuit Dismisses Class Action Against Uniswap
A judge for the Southern District of New York has tossed a lawsuit against decentralized crypto exchange (DEX) Uniswap.
The lawsuit alleged that Uniswap enabled the trading of “scam tokens” that ultimately caused damages to unsuspecting investors.
The judge’s ruling stated that Uniswap’s decentralization makes it so that there is essentially no discernible defendant, and no identifiable law being broken due to the lack of regulatory clarity in crypto.
“Due to the Protocol’s decentralized nature, the identities of the Scam Token issuers are basically unknown and unknowable, leaving Plaintiffs with an identifiable injury but no identifiable defendant. Undaunted, they now sue the Uniswap Defendants and the VC Defendants, hoping that this Court might overlook the fact that the current state of cryptocurrency regulation leaves them without recourse, at least as to the specific claims alleged in this suit.
As set forth in the remainder of this Opinion, the Court dismisses their complaint in full.”
Katherine Polk Failla, the judge who made the ruling, is the same judge overseeing the U.S. Securities and Exchange Commission’s (SEC) lawsuit against Coinbase that it launched on allegations that the crypto exchange was selling unregistered securities.
Last month, Failla voiced her concerns over the fact that the SEC didn’t warn Coinbase that it may have been violating securities laws prior to the exchange’s initial public offering (IPO).
“I am not saying that the commission should be omniscient at the time it’s evaluating a registration statement and that it should know all things. But I would have thought the commission was doing diligence into what Coinbase was doing, and somehow I thought that it would say, you know, you really shouldn’t do this. This is violative of the securities laws, or we are kind of in some interesting unchartered territory here with respect to whether the assets on your platform are securities, so be forewarned that maybe someday there could be a problem.”
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