The charges filed against Bitcoin Mercantile Exchange (BitMEX), a cryptocurrency exchange, and a derivative trading platform could be nasty for Defi.
After the allegations against the exchange, the crypto sector is worried that regulators might as well scrutinize the Defi sector.
On the 1st of October, an allegation was laid against three officials of the exchange for breaching the Bank Secrecy Act by the United States Commodity Futures Trading Commission.
This has led to several questions as to if Decentralized exchanges should also go with the Act. While several Decentralized finance protocol seems to think that they can avoid authorities by being Decentralized, some remain doubtful about this fact. Also, in recent times, Decentralized finance protocols have been under scrutiny for working with a high level of centralization.
Adam Cochran, a blockchain consultant, explained in a social media thread that although regulators might not be able to directly stop the operations of a Dex due to its nature, they could go for core developers with admin keys.
He furthered that any protocol that experiences this might lose several clients and eventually shut down.
Source: Cointelegraph.
