DeFi and Compliance

DeFi protocols run on smart contracts — often without a traditional company in the middle. Regulators still ask who controls upgrades, who profits from fees, and who operates the website users actually visit. "The code is decentralized" is an argument courts and agencies evaluate case by case, not a blanket exemption.

Actions against Tornado Cash, Uniswap interface disputes, and DAO-related settlements show that U.S. and EU authorities will pursue tools used for sanctions evasion or unregistered securities activity — even when core contracts remain deployed.

Builders exploring DeFi should assume geofencing, legal review of token roles, and transparency about admin keys are baseline expectations for serious institutional adoption. This chapter maps the landscape; product decisions need jurisdiction-specific advice.