Sushi DAO proposed the creation of a legal defense fund on March 21 in response to the “recent” subpoena of Sushi chief Jared Gray and the decentralized autonomous organization (DAO) itself by the Securities and Exchange Commission (SEC) of the United States.
The DAO’s proposal did not provide details about the SEC’s subpoena. It stated that it was cooperating with the SEC and that “we do not intend to comment publicly on ongoing investigations or other legal matters.” A community member commented:
“How is it that ‘sushi’ can be quoted [sic]? The human I understand, but sushi is a dao. […] How do they try to get the dao? Pressuring us with going for Jared? [Grey]? I didn’t receive any letters in my mail and I am the dao just like all the other members.”
Japan-based Sushi DAO operates the SushiSwap decentralized exchange using the SushiSwap (SUSH) token. the dao proposed a redesign from SUSH tokenomics late last year after losing $30 million in liquidity provider incentives in 2022.
Sushi created a legal entity “to reduce liability” and then that entity and an individual associated with it got subpoenaed.
PSA: if there’s an entity, it’s not a DAO
Don’t let lawyers talk you into incorporation… unless you want to be a corporation. https://t.co/DATkdiPTCs
—Erik Voorhees (@ErikVoorhees) March 21, 2023
The new proposal suggests dedicating USD 3 million to the fund, with a supplement of USD 1 million if necessary. SUSH sales would cover 15% of the fund. He noted that Maker DAO proposed a similar fund in December. sushi believe for the first time a legal defense fund in March 2022, with funding between $85,000 and $100,000.
Sushi is reportedly the first DAO the SEC would have “attacked” under President Gary Gensler, albeit in recent months. the agency is seen as cracking down against the cryptocurrency industry. In particular, it has focused on staking and the custody. In February, the SEC forced centralized exchange Kraken to discontinue its betting service for US clients. Kraken paid USD 30 million in fines.
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