Uniswap Cleared in Lawsuit as Ether Receives Unexpected Boon

Uniswap’s Victory in the class action lawsuit reshapes the direction of future cases in the cryptocurrency industry.

Uniswap's lawyer reading the news to the unicorn.
Created by Kornelija Poderskytė from DailyCoin
  • Judge Failla dismissed the class-action lawsuit filed against Uniswap.
  • The judge declared Ether a commodity, adding fuel to the debate.
  • Recent legal victories have fueled optimism in the industry.

In the ever-evolving legal landscape of the cryptocurrency ecosystem, recent tides of fortune have left many wondering if the tables are finally turning in favor of the industry. With Ripple and Grayscale enjoying significant wins in their recent court rulings, the industry is a buzz once more as Uniswap becomes the latest courtroom victor.

Uniswap’s Triumph

On August 30, United States district court judge Katherine Polka Failla dismissed a class action lawsuit against DeFi crypto protocol, Uniswap. 

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The lawsuit was initiated on April 4, 2022, by six individuals in the Southern District of New York. They alleged that Uniswap was responsible for hosting scam tokens on its platform, leading to severe financial losses for users. The lawsuit further asserted that Uniswap offered and sold unregistered securities while its creators should be made accountable for fraudulent activities on the platform.  

The presiding judge dismissed the case on the ruling that Uniswap had no relations with the scammers who had issued obscure tokens to the plaintiffs. In her judgment, Judge Failla emphasized that Uniswap is a self-operating protocol primarily used for legitimate purposes, and therefore, the developers were not liable for its misuse.

Judge Declared Ether a Commodity

In a surprising twist during these proceedings, the judge cleared Uniswap and hinted towards the classification of Ether as a commodity. 

Although she did not explicitly declare Ether’s status, Judge Failla highlighted the evolving cryptocurrency regulatory landscape. The allusion is crucial given the fractured opinion held between the United States’ regulatory agencies. While the SEC has consistently maintained that all digital assets except Bitcoin are securities, the CFTC included Ether in its list of commodities.  

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The judge was firm in her acknowledgment of the ongoing debate, declaring, “The Court declines to stretch the federal securities laws to cover the conduct alleged, and concludes that Plaintiffs’ concerns are better addressed to Congress than to this Court.”

On the Flipside

  • Judge Katherine Polk Failla is the presiding judge on the SEC vs. Coinbase lawsuit, which has led many to speculate over the future of the case.
  • The price of the native token on Uniswap experienced a 3% decline in response to the news, dropping to $4.62.

Why This Matters

Uniswap’s victory and the judge’s declaration regarding Ether as a commodity hold profound implications for the cryptocurrency market. Investor confidence, already fragile in the crypto world, now stands to benefit from a potentially more accommodating regulatory environment.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Grace Abidemi

Grace Abidemi, a cryptocurrency reporter at DailyCoin, covers industry developments and trends. She previously worked as a freelance writer. With a Bachelor's degree in German Language and certifications in marketing and storytelling, Grace creates engaging content. When not working, she's in Nigeria, mastering cooking and canvas painting, and enjoys learning about different cultures and languages.