The Bancor Protocol team has initiated a lawsuit against Uniswap Labs and the Uniswap Foundation, accusing them of intellectual property theft. The primary reason for this is the automated market maker (AMM) infrastructure that is common to both decentralized exchanges.
This is reported by Business • Media
According to information presented by the Bancor team, the Bprotocol Foundation patented the technology underlying CPAMM back in January 2017. However, Uniswap Labs, which launched its solution in 2018, is accused of unlawfully using this technology, which has brought the studio “significant profits.”
Comments from Bancor Leadership
Mark Richardson, the project lead for Bancor, commented on the situation, stating:
“When an organization continuously uses our invention without our permission and does so as a means of competing with us, we must take action. For the past eight years, Uniswap has used our patented technology in its projects without our consent. As a result, we have taken legal measures to protect our technology for the benefit of the entire DeFi community.”
The Bprotocol Foundation, along with LocalCoin Ltd., another party to the lawsuit, is seeking damages and a court injunction against Uniswap Labs and the Uniswap Foundation to prevent further use of their technology.
Uniswap’s Response
The Uniswap team responded to the lawsuit, calling it baseless. A studio representative stated in a comment:
“This lawsuit is without merit, and we will defend ourselves accordingly. The Uniswap protocol code is public and has been for many years. What a wasteful distraction at a historic moment for DeFi.”
Hayden Adams, CEO of Uniswap Labs, also weighed in on the matter:
“This is probably the dumbest thing I’ve seen. I look forward to the moment I can stop thinking about it, hearing from our lawyer that we won.”
However, not all community members supported Uniswap’s position. Some users expressed the view that the Bancor team indeed invented the AMM architecture, and that Uniswap Labs itself encourages the protection of intellectual property by prohibiting other developers from using the code of its protocol.
According to DeFiLlama data, Uniswap ranks first in total value locked (TVL) among decentralized exchanges, while Bancor Protocol ranks 41st. In 2023, the Bprotocol Foundation itself became the subject of a lawsuit when investors accused the organization of promoting unlicensed securities and misleading regarding the effectiveness of the impermanent loss protection mechanism (ILP).