In order to keep crypto within the United States, Coinbase CEO Brian Armstrong believes that the country needs to change its regulatory stance. With many countries offering friendlier regulations, Armstrong warns that crypto will continue to go offshore unless the US adapts. This comes as the crypto industry sees increased scrutiny and proposed regulations from government officials.
Why regulators need to take the crypto industry seriously
There’s been a lot of talk about cryptocurrency and its potential for revolutionizing the way we handle finance. However, there’s one major hurdle that could prevent this from happening – the lack of proper legislation and regulation. According to Brian Armstrong, the CEO of Coinbase, the US and UK-based crypto companies might consider relocating to other countries if domestic watchdogs don’t come up with appropriate rules to govern the industry.
Armstrong believes that if nations fail to enforce clear, well-defined policies, cryptocurrency firms will have to move to offshore havens to operate effectively. As a result, the US and UK could miss out on significant economic growth opportunities.
The regulatory uncertainty surrounding the crypto industry is a major concern for Armstrong, who notes that the infamous FTX crash in November last year only highlighted the importance of applicable crypto rules. The UK is already taking steps in the right direction, moving fast on sensible crypto regulation to drive economic growth and consumer protection.
Despite the potential for growth, Armstrong is not ruling out relocating Coinbase to another country, hinting that “anything is on the table, including relocation or whatever is necessary”. Although he recognizes that the US could be a key market for the crypto industry, the regulatory uncertainty could push Coinbase to invest elsewhere in the world.
Coinbase’s Issues in America
Coinbase is not the only US-based crypto firm that has a conflict with regulators. Last year, the SEC initiated an investigation into some of the cryptocurrencies listed on the platform that are suspected of being unregistered securities. The Commission also issued a Wells Notice against Coinbase in March this year, potentially tied to the exchange’s Earn, Prime, and Wallet products.
Despite these challenges, Armstrong remains confident in the facts and welcomes the opportunity for Coinbase to get before a court. Other US-based crypto firms, like Kraken, have also been probed by the SEC over possible violations of securities rules. Kraken had to terminate its staking services and pay $30 million in disgorgement, prejudgment interest, and civil penalties.
It’s clear that cryptocurrency companies need regulation to succeed, and countries with forward-thinking regulators stand to benefit. If the US and UK do not implement proper legislation on the industry, it could lead to an exodus of firms to other countries that are more open-minded towards digital currency.