The Securities and Exchange Commission has recently issued a subpoena for Sushiswap. The subpoena is addressed to the DEX entity as well as the head developer named, Jared Grey. The crypto entity has confirmed the receipt of the subpoena recently.
Grey has called for a $3 million fund from the SushiDAO project to prepare a legal defence that will go towards covering the legal fees.
Sushi founded the DAO last year as a way to offset any type of regulatory retaliation from the government. He has posted a new blog post where he claimed that he was cooperating with the regulators.
He also mentioned that after the official receiving of the subpoena, it has become necessary to access these funds to ensure operational continuation and protect the interest of the contributors.
SEC Receives Harsh Criticism from Crypto Community
There is increasing unrest in the DeFi community over the stance of regulators towards the crypto market and products. SEC has plans to bring a trial against every cryptocurrency enterprise that is using the PoS trading model.
To this end, SEC will have to work out thousands of lawsuits considering the sheer number of decentralized finance applications trading on the Ethereum network alone.
However, the media have noted that SEC Chief has continued to increase human resources since last year. He has also called for additional funding from Congress to support the siege against the cryptocurrency network.
Meanwhile, some experts claim that the government has assumed the role of a negative personality among DeFi proponents that can hinder their progress against DeFi markets. On the flip side, the US government is also facing criticism from the traditional financial network on account of interest hikes.
SEC has refrained from making any official comments on the matter of issuing the prosecution subpoena for Sushiswap. Meanwhile, the DEX has also maintained that it has no intentions of making any public comments while the investigators are conducting due process and till the legal matters are settled.
The defence team of Sushi has claimed that the DAO fund will be able to cover the fees and costs of legal proceedings within a reasonable range.
The contributors of the fund have been pitching in consistently since last year in the form of Sushi 2.0. These funds are currently available in different ratios of Kanpai fees, various grants, and Sushi tokens.
In case this fund runs out before legal proceedings are over, the DAO can make a $1 million USDT grant. Thus far, developers have refrained from talking about any projections and expectations from the legal proceedings.