US Commodity Futures Trading Commission Wins Lawsuit Against Ooki DAO

In the lawsuit that the US Commodity Futures Trading Commission (CFTC) sued Ooki DAO for offering unregistered commodities, as Ooki DAO failed to respond, U.S. District Judge William H. Orrick ruled on Thursday that CFTC won the case, ordering Ooki DAO to pay $643,542 in penalty, to permanently cease its operations and shut down its website.

The judgement sets a precedent that DAOs are under regulatory scrutiny. The court believed that Ooki DAO should be held liable for legal violations as a "person" under the Commodity Exchange Act. CFTC Division of Enforcement Director Ian McGinley said, "the founders created the Ooki DAO with an evasive purpose, and with the explicit goal of operating an illegal trading platform without legal accountability. This decision should serve as a wake-up call to anyone who believes they can circumvent the law by adopting a DAO structure, intending to insulate themselves from law enforcement and ultimately putting the public at risk."

The CFTC filed the lawsuit against Ooki DAO in September 2022.

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