Uniswap is the largest decentralized exchange (dex) platform in regard to trade volume and it recently revealed its decision of removing a number of tokens from the main interface of the platform. This removal was made under the assumption of the community that global regulators could see these tokens as securities. These tokens can still be swapped by Uniswap users if they themselves access specific smart contracts. This is because the tokens have only been removed by Uniswap Labs, the company behind the entire platform, from the main interface. The startup made the announcement on July 23rd about the decision of its development team of removing around 129 tokens from the interface.
Onlookers have noted that a number of tokens that were removed could be termed securities by global securities, while there are also those that are synthetic equities tokens. Access to these specific tokens is restricted from app.uniswap.org, but it is possible for users to bypass this problem altogether and use the token contract for trading. While the announcement for token removal from Uniswap Labs does not really explain the reason behind it, but the company said that these tokens represent a very small part of the overall volume on the decentralized exchange platform.
Some of the tokens that have been removed were derived from protocols, such as Tether, UMA, Synthetix, and Opyn. Even if these tokens are added manually, you will not be able to trade them on the main interface. However, the crypto community has come up with a plethora of ways through which people can bypass the main interface of Uniswap. The move also received criticism from a number of crypto supporters because they believe that other decentralized finance (defi) platforms can also mirror the move. The co-founder of Augur and co-CIO of Pantera Capital, Joey Krug said that while he loved Uniswap, this move is setting up a very bad precedent.
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He also added that this will not be the first case of defi censorship. According to DeFi supporters, it is time for people to bookmark decentralized finances and mirror applications. This is because they believe the world is in need of these decentralized interfaces and there was a possibility that they can be wiped out, so it is a good idea to have them bookmarked. Andre Cronje, the man behind the renowned defi project known as Yearn Finance, also shared his opinion regarding this move by Uniswap.
He said that it was a company registered in the United States and its website was owned by a US entity. Therefore, the company needed to act in its best interests, which include censoring the website where it is in their interest. This move by Uniswap appears to be prepared for scrutiny by global regulators, something that is affecting the entire crypto space. Ripple is an excellent example of a token that has been termed as security and has faced legal consequences as a result. It is apparent that Uniswap wishes to avoid a legal problem in the future.