The crypto regulatory situation now escalates with Coinbase. In the United States, the crypto businesses have had a hard time succeeding.
The growth of the industry has been stifled by a lack of clarity from regulators. If the current state of affairs between the crypto market and the US government continues, companies may start looking for new locations.
Will Coinbase leave the US?
If the regulatory climate for the business does not become clearer, Coinbase (COIN) CEO, Brian Armstrong, has said the cryptocurrency exchange may even consider leaving the US.
Related article: Current crypto regulatory challenges in USA – what you need to know
There is a lack of regulatory clarity in the country, which he believes could prevent it from becoming a major market for cryptocurrencies. Ever since 2022, it’s been increasingly difficult for crypto businesses to operate, especially in the US. Most importantly, the US Securities and Exchange Commission (SEC) is behind most of these operations.
“I think the US has the potential to be an important market for crypto, but right now we are not seeing that regulatory clarity that we need. I think in a number of years if we don’t see that regulatory clarity emerge in the US, we may have to consider investing more elsewhere in the world,” he explained.
Armstrong’s remarks follow those of Bittrex, another cryptocurrency exchange, which said in early March that it would cease operations in the US by the end of April due to “the current US regulatory and economic environment.”
Armstrong explained that Commodity Futures Trading Commission (CFTC) and the SEC are responsible for creating regulatory frameworks in the US. However, the Financial Conduct Authority (FCA) in the United Kingdom is the only regulator responsible for both commodities and securities.
“Things like Bitcoin, Ethereum, DeFi, and even self-custodial wallets should be regulated like a software business or something like that,” Coinbase CEO stated.
The SEC issued Coinbase a Wells Notice back in March. According to Armstrong, he dealt with the SEC thirty times without Coinbase receiving any comment about the nature of its business. He claimed that authorities’ perspectives on the many subsets of the Bitcoin business lacked distinction and depth.
Great meeting today with UK Economic Secretary and City Minister @griffitha.
The UK is moving fast on sensible crypto regulation to both drive economic growth AND consumer protection. Excited to keep investing in the UK. 🇬🇧 pic.twitter.com/478PQSLmDe
— Brian Armstrong (@brian_armstrong) April 17, 2023
How’s Coinbase doing in Europe and UK?
UK adults’ interest in crypto is increasing and 22% reportedly already own cryptocurrencies, according to the Coinbase blog. The company has laid out nine recommendations to position the UK as a leader in the crypto sector.
These include developing a regulatory framework that promotes stablecoins, creating a plan to bring decentralized ID to fruition, and ensuring banks and fintech companies collaborate to accelerate crypto innovation. It’s all in motion instead of being stuck like it is in the US right now.
The UK has made significant advances toward establishing a consumer and business-friendly regulatory framework. While the situation in the US is unclear, it will surely be properly set up soon as everyone’s eyeing Gary Gensler’s court hearings over an almost bullysome stance towards crypto.