Breaking: SushiSwap Served With Subpoena By U.S. SEC; CEO Calls For “Legal Defense Fund”

What comes as a shocker for the crypto market, leading decentralized exchange (DEX), SushiSwap and its Head Chef Jared Grey, have been served with a subpoena by the U.S. SEC recently. The team is currently in the process of having discussions with the financial watchdog and has refrained from commenting publicly about the ongoing investigation.

SushiSwap Served With SEC Subpoena

The news was first brought to light by Jared Grey on Sushi’s new governance proposal which aims to establish a “Legal Defense Fund” in order to cover legal costs for the core contributors. Jared proposed that the Sushi DAO — which governs and looks after the decentralized protocol — set apart a fund to the tune of $3 million USDT. This fund will cover legal costs regarding inquiries, litigation, and other issues targeting core contributors.

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In addition, he goes on to note that Sushi (Sushi Legal Structure), in accordance with the plan that was provided in March ’22, attempted to form a legal entity in order to lessen the contributors’ and the DAO’s legal responsibility. But, it is now abundantly clear that funds must be made available in order to manage the legal requirements in order to maintain “operational continuity and to protect core contributors”.

Jared Proposes Legal Defense Fund

According to the proposal raised by Jared, the Sushi DAO’s Legal Defense Fund will provide coverage for multiple attorney fees and charges levied against core contributors who have been active since the ratification of Sushi 2.0 up until the present time. Even in case of a contributor resigns or gets abruptly terminated, the Legal Defense Fund will continue with the payments until the legal proceedings have concluded.

The $3M fund will be stored in a newly created multisig wallet and will be an amalgamation of funds from various events such as 50% of Kanpai fees, 35% from grants and 15% from Sushi’s TWAP market sales. According to Jared, this is done in order to lessen the financial burden while safeguarding Sushi DAO’s financial solvency, and addressing the urgent necessity to meet the costs of legal representation.

In response to this revelation, SushiSwap’s native token, SUSHI, has fallen victim to widespread FUD. As things currently stand, the price of SUSHI has dropped by over 5% in the past one hour and is presently exchanging hands at $1.16 with a market cap of $258 million.

Also Read: Hedera’s Patented Token Recovery System To Go Live Soon; What It Means For HBAR Price?

The post Breaking: SushiSwap Served With Subpoena By U.S. SEC; CEO Calls For “Legal Defense Fund” appeared first on CoinGape.

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Pratik Bhuyan
CoinGape