DEX Uniswap Faces Community Backlash Over Privacy Policy

Key Insights

• Uniswap released a new policy on users’ information privacy
• The policy will enable the exchange to save the personal information of customers
• Industry players are unhappy with the policy as it negates the decentralization policy of crypto

Uniswap, one of the prominent decentralized exchanges, recently became a subject of criticism and backlash. This backlash concerns the new privacy policy which the decentralized exchange introduced. 

You would recall that this backlash is not the first to Uniswap.  In July 2021, community users frowned at the crypto exchange’s decision to delist 100 tokens. 

More than a year later, the decentralized exchange became the subject of another backlash. 

Uniswap’s New Privacy Policy

Recently, Uniswap Lab released its new and updated privacy policy. The policy explained how Uniswap collects and stores users’ data. 

In the post announcing the privacy policy, they said, “we are releasing a new privacy policy— we want to be clear about what data we are protecting and how we use any data we collect. Transparency is key. We  never want our users to be surprised.” 

 The updated policy revealed that the exchange platform collects publicly-available blockchain data. 

Similarly, it includes information about user devices, such as browser information and operating systems. It also includes information about user interactions with service providers. 

In clarifying the new policy, Uniswap says none of this information includes personally identifiable information— such as first & last names, birth dates, email addresses, IP addresses, location etc. 

However, since the release, the privacy policy has generated backlash and criticism from community members and industry players. The larger part of these individuals says the moves by Uniswap are in contrast to crypto’s core values. 

Experts and industry players say it is uncharacteristic of DEX to collect and store user information on the backend. 

Uniswap Receives Backlash For Delisting  Tokens

Another decision of Uniswap that received backlash was delisting about 100 tokens in July 2021. The tokens were delisted from its front-end interface, and industry players considered it a random delist. These tokens included synthetic stock tokens from Synthetix, option tokens from UMA, mirrored tokens from Mirror Protocol, and insurance tokens from Opyn. 

Uniswap Lab says that the protocol remains “entirely autonomous, immutable, and permissionless.” after the delisting. 

Most of the backlash centers around the reason for such a decision— it was believed that the tokens were chosen randomly, and Uniswap had no reason.