Uniswap, a blockchain-based exchange protocol, will likely face regulatory pressure as it is unwittingly offering services to US clients, says EXANTE Co-Founder Anatoliy Knyazev.
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The Co-Founder of EXANTE notes that the high-profile case with the BitMEX cryptocurrency exchange, which, according to the US Commodity Futures Trading Commission offered US clients illicit crypto derivative trading services, is based "on a complex of rules, rather than a specific incident."
"Any business in the world that services (or may service) US clients and develops and markets itself in the US may fall under these rules," Knyazev says.
The Uniswap protocol does not identify clients due to its decentralized architecture. Notwithstanding, such an excuse is unlikely to save the project from regulatory prosecution, Knyazev believes:
"Although the DOJ investigates Uniswap, this doesn’t mean it will arrest smart contracts. However, there are always people who develop software, app store apps or do marketing. The US laws can make these people liable."
EXANTE's Co-Founder assume that in the worst case of the regulatory carnage, the crypto market will be left with a "stripped down" smart contract that users can use directly. In practice, 99% of current users will ditch it in the absence of applications and marketing.
We witnessed this happening with decentralized trading exchange platform EtherDelta, whose creator and website administrator got heavily fined, Knyazev highlighted.
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