Uniswap volumes approach $3 billion despite Wells Notice

April is proving to be a month to remember for Uniswap UNI -4.11% .

For starters, the decentralized exchange powerhouse crossed $2 trillion in total trading volume on April 5, solidifying its status as a major DEX player as competition heats up across networks, particularly on Solana, where Uniswap does not have a presence.

On a more sour note, the platform got served a Wells notice from the Securities and Exchange Commission on April 10, with many thinking this signaled the start of a war on DeFi.

The SEC going after crypto is nothing new, but in the past, we've primarily seen big-name cases for the agency being brought against centralized players.

Uniswap is somewhat of a unique case. Many crypto platforms have backed off from U.S. clientele due to fears of stringent regulatory action. In turn, some DeFi platform frontends block users with a U.S. IP address (although some people circumvent this with a VPN), but Uniswap does not engage in this practice. While frontends are typically one of the most user-friendly ways to interact with DeFi protocols, they are not the only way.

In Uniswap Labs’ mind, it simply operates a website that gives people access to the Uniswap protocol, which is simply a set of smart contracts. This does make Uniswap a ripe target for the SEC, especially given its market dominance.

Online, there has been an outcry of support from the crypto community, with many noting the significance of the fight. Uniswap founder Hayden Adams posted on X that he’s not surprised, “just annoyed, disappointed, and ready to fight."

There is still a long road ahead for this battle. Coinbase received its Wells notice in March 2023, and so far, not much has come of it, even over a year later.

UNI price action

The price of UNI, the Uniswap governance token, did dip a bit on the news, dropping from over $11 right before the announcement to hovering below $9. However, UNI got a boost in late February from a proposal to grant rewards to token holders, so the token was still up 23% year-to-date on Friday. However, the market crash over the weekend pushed UNI down further.

And it seems interest in Uniswap itself is not waning, with daily volumes climbing over the weekend and continually hitting the $3 billion threshold.

The fees collected by the exchange’s frontend skyrocketed toward the end of last week, as well, but not due to increased usage. Uniswap Labs hiked the six-month-old 0.15% charge that was added to certain swaps on its web interface to 0.25%.

The change seemed to go into place just hours after Uniswap confirmed its Wells notice without much announcement. It’s possible the increased fees will help go towards bolstering Uniswap Labs’ coffers ahead of their legal battle. On Ethereum alone, the interface has generated over $500,000 of revenue in one day after the switch.

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