Here’s what the DeFi Education Fund (DEF) has been up to in October. If you have any questions or would like to learn more about a specific activity, please do not hesitate to reach out.
Leading up to the midterm elections, DEF has been primarily focused on two macro issues: potential legislative action on regulating crypto spot markets in the Senate (which could have major implications for DeFi) and the CFTC vs. Ooki DAO litigation.
The Digital Commodity Consumer Protection Act (DCCPA)
We continued making the case this month that regulating DeFi in a framework designed to regulate CeFi institutions in the digital commodity spot markets doesn’t make sense. Because CeFi markets and DeFi markets function in totally different ways, accomplishing the same policy objectives in both will require different approaches. If the same CeFi regulations were applied to DeFi developers, protocols, or market participants, the consequences would be disastrous.
In addition, we hope to see more of the open debate this issue stimulated in the crypto and DeFi worlds. Debating these issues transparently and openly is certainly a unique characteristic of crypto and DeFi compared to other industries, and we always love seeing folks passionately defending DeFi’s core values.
Ooki DAO v. CFTC
In continuing to respond to the CFTC’s litigation against a DAO, we filed an amicus brief in which we asked the court to reconsider its order granting the CFTC’s motion for alternative service. In the brief, we argue that DAOs are not necessarily "associations" of any kind and therefore may not be valid defendants in a CFTC enforcement action.
Ultimately, the judge presiding over our case accepted our brief and ordered the CFTC to respond to our motion. This was GREAT news!
As for next steps in the matter, below represents a timeline of the key upcoming milestones:
November 14, 2022: CFTC Response to Amicus Briefs Due
November 21, 2022: Response to CFTC’s Opposition Due
December 7, 2022: Court Hearing on the Motions for Reconsideration
And be sure to mark your calendars because in the coming weeks, we will be hosting a Twitter Space to talk about the matter.
Twitter Space Conversations
In October we held, and participated in a handful of Twitter Space conversations, discussing the various policy implications stemming from multiple pieces of legislation and executive actions.
On October 19th, we convened a group of experts from both policy and legal backgrounds for a wide-ranging discussion on how to regulate stablecoins, specifically looking at the draft piece of legislation from the House Financial Services Committee.
On October 5th, our Policy Director, Miller Whitehouse-Levine, joined a Space entitled, “Dispassionate DeFi: On Law and Policy.” A recording of that conversation can be found here.
As mentioned above, stay tuned for our next Spaces, which will focus on the CFTC’s action against Ooki Dao and the upcoming hearing on the matter.
Notably, the Ooki DAO has not made an appearance in the CFTC’s case. But three amici have submitted briefs protesting the CFTC’s alternative means of service: the DeFi Education Fund, an advocacy group promoting decentralized financial products; LeXpunK, a group of cryptolawyers and software developers that offers open-source legal resources for DAOs; and Paradigm Operations LP, an investment firm that backs crypto companies.
“These are questions of fairness and liability that are generally handled via state law,” said Miller Whitehouse-Levine, policy director at DeFi Education Fund.
POLITICO: How to sue an amorphous digital blob
While the briefs don’t answer the question of how the government should serve a DAO, the policy director for one of the outside groups, Miller Whitehouse-Levine of the DeFi Education Fund — a 501(c)(4) advocacy group that is itself funded by the Uniswap DAO — pointed me to an intriguing state court precedent.
"First Mover" is live from CoinDesk's Investing in Digital Enterprises and Assets Summit (I.D.E.A.S.) in New York City, diving into key investment ideas across Web3 and the digital economy at large. Host Christine Lee and DeFi Education Fund's Miller Whitehouse-Levine speak with Umee CEO Brent Xu with his crypto markets analysis, and Gennaro D'Urso, a scientist using a DAO to improve drug discovery.
U.S. District Judge William Orrick, of the Northern District of California, ordered that LeXpunK Army, a group of lawyers and software developers, and the DeFi Education Fund (DEF), a lobbyist group, could file Amicus Briefs, or friends of the court briefs. The two groups asked to join the case to argue that the CFTC should identify and directly serve members of Ooki DAO in a lawsuit alleging they violated federal law, rather than serve the DAO itself through a website chat bot.
The DeFi Education Fund (DEF), a Washington, D.C.-based lobbying group focused on decentralized finance (DeFi) issues, has joined a group of crypto lawyers in arguing that the Commodity Futures Trading Commission (CFTC) should not be allowed to serve the defendants of a lawsuit merely by posting on a website.
DeFi Education Fund filed a motion Tuesday for leave to file an amicus brief, the day after advocacy group LeXpunK filed a similar motion in the case. The court approved the CFTC's motion for alternative service on defendant Ooki DAO on Monday, but DeFi Education Fund argued the court should reconsider that order.
The Lexcon Crypto Show: Was the CFTC right to sue Ooki Dao? Hear from Miller Whitehouse-Levine of DEF
Miller Whitehouse-Levine of the Defi Education Fund joins Andrew in the studio today to discuss the latest news and activity of the DEF.
The ReFi DeFi Podcast: The DeFi Education Fund
It's clear that US regulators are shining a spotlight on DeFi. It's essential that we have a group that is dedicated to educating policymakers and shaping the future of DeFi. In this episode, we had the honor to speak to Miller Whitehouse-Levine, Policy Director at the DEF.
For up-to-date information about what’s happening in D.C. and what we are up to, please follow us on Twitter @fund_defi and subscribe to our Substack.