Long-Term SUSHI Holders Jump Ship After Recent SEC Notice
Recently, Santiment, an on-chain analytical platform, posted its latest insights concerning SushiSwap (SUSHI), a decentralized autonomous organization (DAO) that the US SEC sent a subpoena earlier this week.
SUSHI’s TVL Plummets By 93% Since FTX Saga
The report reveals a grim outlook for the decentralized platform, indicating that SUSHI’s total value locked (TVL) has plummeted by 93% since FTX’s collapse in mid-November 2022. Presently, SUSHI’s TVL hovers around $581.47 million.
According to the data provided by Dappradar, the usage of SUSHI’s protocol has dropped in the past year. The report analyzed the dApp’s smart contract transactions, specifically focusing on the number of unique active wallets (UAW) interacting with it.
The results revealed that the average UAW has remained fairly stagnant, showing minimal growth over the recent months. In addition, the report drew attention to the number of SUSHI tokens that have remained inactive for over a year.
Santiment’s data indicate that long-term investors are selling their assets. Per the report, there was a significant drop in the overall quantity of SUSHI tokens that have remained inactive for over a year in the last 24 hours.
This increased activity has affected SUSHI’s price causing it to drop. Meanwhile, the number of inactive tokens transferred to exchanges reinforces the bearish argument as the number of SUSHI tokens available on exchanges aligns with the number of dormant tokens that have remained unused for the past year.
Moreover, Lookonchain data revealed that Goldentree sold 5,954,024 SUSHI on Binance through Cumberland. However, the latest sell-off is no surprise given the recent subpoena from the US securities regulator.
Sushi DAO Greenlights Proposal To Launch Legal Defense Fund
Last week, Sushi DAO announced that the SEC had issued a subpoena. Jared Grey, the ‘Head Chef’ who assumed the CEO position last October, was also named as a target of the subpoena.
Consequently, Grey proposed the creation of a legal defense fund to finance the legal expenses of essential contributors in response to the SEC notice.
He explained in the proposal that the required amount is $3 million. Interestingly, most of the community members, 79% of the voters, have approved the proposal to establish the legal defense fund.
On the other hand, US regulatory authorities are increasingly focusing on DAOs. Over the past few years, DAOs have been the subject of its scrutiny. Last year, the US Commodity Futures Trading Commission (CFTC) filed a lawsuit against Ooki DAO, alleging that it had unlawfully provided cryptocurrency derivative products.
Furthermore, the SEC has targeted CryptoFed DAO, a legally established DAO in Wyoming, as part of its enforcement efforts. The crypto community has responded to these actions, viewing them as severe regulatory overreach.
Currently, the CFTC and SEC are aggressively pursuing stricter regulations for the cryptocurrency market.
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