DeFi Education Fund & Uniswap Push Back on SEC Regulation
In a move aimed at protecting the decentralized finance (DeFi) ecosystem, the DeFi Education Fund and the Uniswap Foundation have urged the U.S. Securities and Exchange Commission (SEC) to back off from regulating most decentralized autonomous organizations (DAOs).
In a letter dated May 27 to SEC Commissioner Hester Peirce, the two organizations argued that DAOs should not be regulated under the traditional securities framework if they are **”sufficiently decentralized.”_
DAOs Are Not Companies, Say Crypto Advocates
The central claim of the letter is that DAOs do not operate like companies and therefore should not be assessed under the Howey test, which is typically used to determine whether an asset is a security.
“If a DAO has a dispersed collection of tokenholders who actively govern the network, it should not be subject to securities laws,” the letter reads.
Instead, the authors proposed that DAOs be treated as individuals or informal collectives—unless the SEC can demonstrate otherwise.
“DAOs are not identifiable legal entities,” the letter emphasized, “and should not be subjected to enforcement meant for centralized actors.”
Regulatory Signals Under Trump’s SEC Leadership
This letter comes amid a shifting regulatory landscape. Under the Trump administration, former crypto lobbyist Paul Atkins was appointed to lead the SEC, signaling a more crypto-friendly approach.
Atkins has publicly supported the idea that blockchain can foster new market innovations and warned against overregulation.
During a May 20 SEC oversight hearing, Atkins confirmed that the SEC Crypto Task Force’s first report will be released in the coming months. He also noted that roundtable discussions with key crypto industry stakeholders are ongoing.
Industry Reaction and the Road Ahead
The crypto industry sees this as a critical opportunity to shape future policy. The DeFi Education Fund and Uniswap’s joint statement is part of broader efforts to ensure that innovation is not stifled by legacy regulatory frameworks.
“A favorable regulatory environment is essential to the continued growth of DeFi,” said a Uniswap spokesperson.
Conclusion
As the SEC reevaluates its approach under new leadership, crypto advocates are pushing to reframe how decentralized entities like DAOs are viewed by regulators. Whether these calls for leniency will be heeded remains to be seen—but for now, the future of DAO regulation hangs in the balance.