Sushi and its ‘head chef’ obtain SEC subpoena

DeFi venture Sushi and its most important chief have been subpoenaed by the U.S. Securities and Alternate Fee (SEC), in keeping with a discussion board put up on March 21.

Sushi subpoenaed by regulators

That discussion board put up, printed by Sushi “head chef” Jared Grey, signifies that each he and the venture itself had been lately served an SEC subpoena.

That put up suggests establishing a $3 million authorized fund to cowl authorized prices, funded with Tether’s USDT stablecoin and launched via a DAO proposal.

Outcomes from an early ballot hooked up to Gray’s unique discussion board put up counsel that a lot of the group is in favor of such a authorized fund, with 80% of 21 voters stating that they favor establishing the fund. Nonetheless, that vote just isn’t a choice from Sushi’s DAO.

The discussion board put up provides few different particulars on the character of the subpoena. The put up says that Sushi won’t remark additional however that it’s cooperating with the SEC.

The worth of Sushi’s native cryptocurrency token (SUSHI) fell from $1.22 to $1.15 shortly after the information, representing a lack of roughly 6.5%.

Can the SEC regulate DeFi?

In concept, any decentralized finance venture ought to be immune to regulation as a result of an absence of central authority that may be focused by authorities.

As such, the Sushi group questioned how Sushi itself was subpoenaed. Third-party websites counsel that the venture is headquartered in New York or Japan, however it’s not clear that any workplaces exist. Supposedly, members of the venture’s DAO may very well be subpoenaed, however at the least one member of the DAO has denied receiving the subpoena.

Sushi just isn’t the primary decentralized crypto venture to draw the eye of the SEC. In 2021, the SEC took motion towards the fraudulent DeFi Cash Market. And in 2018, the SEC took motion towards the early decentralized change Etherdelta and its founder.

It’s attainable that the SEC is wanting into different decentralized initiatives as effectively. Unverified rumors emerged round March 3 that a number of DeFi platforms had acquired a Wells discover from the U.S. SEC over an unspecified time period.

Nonetheless, a Wells discover would point out that the SEC intends to take enforcement motion — whereas Sushi’s subpoena solely implies an investigation.