Sushi, maker of the Ethereum-based decentralized exchange SushiSwap, disclosed on Tuesday it had received a subpoena from the Securities and Exchange Commission, signaling it could soon be subject to regulatory enforcement action. The organization’s disclosure came in the form of a proposal submitted to the Sushi DAO for the establishment of a legal defense fund to cover potential legal costs. “Sushi, and Head Chef Jared Grey, were recently served with an SEC Subpoena,” the proposal stated. “We’re cooperating with the SEC.” SushiSwap’s SUSHI token fell 5% after the disclosure, falling as low as $1.14 from $1.22 in just an hour, according to CoinGecko. The subpoena represents just the latest in a string of SEC enforcement actions that include fining cryptocurrency exchange Kraken over its staking product and suing Terraform Labs founder and CEO Do Kwon for alleged securities fraud. As of Monday afternoon, the SEC had yet to announce it delivered a subpoena to Grey or Sushi. Sushi did not immediately respond to requests for comment from Decrypt. The DAO proposal seeks to make $3 million available for the legal fund in the form of Tether’s USDT stablecoin. It includes a contingency that would make another $1 million worth of USDT available if the initial funds are depleted.
Read more : SushiSwap Subpoenaed by SEC, Proposes Legal Defense Fund to Sushi DAO.
