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SEC Moves to Regulate Uniswap: Bitwise Files for ETF Amidst Increased Scrutiny

Crypto asset manager Bitwise has filed with the SEC to launch an exchange-traded fund (ETF) focused on Uniswap, marking a significant development in decentralized finance (DeFi).

The ETF aims to offer exposure to Uniswap's governance token, UNI, an indication of institutional interest in decentralized exchanges.

In its filing, Bitwise outlines its investment objective to reflect the value of Uniswap held by the Trust, minus operational expenses.

This filing comes as the SEC has intensified scrutiny on DeFi platforms, including Uniswap, questioning their compliance with securities laws.

Regulatory authorities are reviewing the Bitwise application, which follows a prior investigation into Uniswap Labs for potential unregistered securities transactions.

Uniswap allows users to swap tokens without intermediaries, which has raised compliance concerns for regulators.

Although UNI has recently dropped over 16% amid a wider market correction, the push for a Uniswap-focused ETF could indicate a potential shift in market dynamics.

The SEC's increasing focus on DeFi could set a precedent for other blockchain-based projects, resulting in both opportunities and challenges for innovation.

Coinbase Custody Trust Company would be the custodian for the Bitwise ETF if approved, which could further legitimize the asset class.

As the SEC navigates the complexities of DeFi, market participants remain watchful of how these regulatory developments will impact the future of decentralized finance.