Sushi, the Web3 exchange that became a decentralized autonomous organization (DAO), is looking to organize a legal defense fund. If approved, the proposal, which is already available for voting, will allocate $3 million USDT as part of a fund to defend against legal action against the organization and its members. The organization revealed that it had recently received a subpoena from the US Securities and Exchange Commission (SEC).
Sushi DAO Submits Proposal to Establish Legal Defense Fund
Sushi DAO, a Web3 staking and exchange platform, is seeking support to establish a legal defense fund in order to effectively take on legal cases already coming its way. He proposalwhich is currently being approved with the support of 75% of the votes at the time of writing, would allow the organization to use $3 million USDT to help your maintainers defend against lawsuits and legal cases.
If approved, the fund would come from Kanpai, which is part of the DAO treasury, at 50%. The other 50% would be deducted from the Sushi quotas and from the reserve destined to the granting of scholarships. If it runs out, the organization would have to repay the initiative with $1 million. USDT more until the end of the legal case.
Undisclosed SEC subpoena received
Jared Gray, head chef and main maintainer of Sushi DAO, announced that he had received a subpoena from the US SEC, but did not disclose the nature of the case the organization is facing. When asked about it, Gray said:
Unfortunately, I can’t speak publicly other than what was revealed in the post, which is standard. Many DAOs will need or have implemented Taxpayer Legal Defense Funds.
Sushi follows in the footsteps of Makerdao, which also established a legal fund in December to cover similar expenses, with coverage of up to 5 million DAI. However, Makerdao proposal it is more specific and includes definitions of beneficiaries and claims, as well as periods for making payments and determining eligibility for these protections.
This is not the first time that a US government organization has taken legal action against a DAO. The Commodity Futures Trading Commission (CFTC) already did it in September, alleging Ooki DAO had illegally offered trading services to US citizens without registering as a Designated Contract Market (DCM). The Ooki DAO case is still ongoing.
What do you think about Sushi setting up a legal defense fund to protect their DAO and head chef Jared Gray? Tell us in the comment section below.
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