The United States is creating a harsher environment for the crypto sector. Since the collapse of the exchange, FTX, the U.S. Securities and Exchange Commission (SEC) has been cracking down on the industry. They have been issuing notices and investigating crypto and crypto-friendly firms. Recently, Coinbase CEO, Brian Armstrong said that the firm might move overseas if this continues. They also asked the regulatory body to set up proper rules and regulations for the crypto industry.
Chamath Palihapitiya recently covered the current crypto regulatory landscape on the All-In podcast. Palihapitiya is a Canadian-American venture capitalist and the CEO and founder of Social Capital Fund. He is a supporter of SPACs, a type of investment vehicle that permits private firms to go public with less SEC scrutiny. Social Capital has a $6 billion balance sheet and a $7.8 million carrying value in 2021. The organisation focuses on investing in and giving equity funding to early-stage tech entrepreneurs.
Palihapitiya highlighted the current crypto regulatory landscape in the United States in the 125th episode of the All-In podcast, including Coinbase’s plans to migrate abroad. He too blamed SEC for this want to reallocate.
“Crypto is dead in America. I mean, now you have Gensler even blaming the banking crisis on crypto – so the United States authorities have firmly pointed their guns at crypto.”
Taking Coinbase’s side even further, he asserted that Coinbase followed the regulations, stood in line and attempted to do the right thing. Every step of the way, it appears, from board membership to executive makeup to how they attempt to communicate with regulators. Despite this, they were most likely the furthest away from obtaining a licence. The one that came the closest was the most fraudulent, which was FTX.
Gary Gelsner, the chair of the SEC has blamed major banking failures in America on the crypto industry. He has said that the crypto industry needs to strictly abide by the rules of U.S. security, even calling the industry the ‘wild west’. But, while appearing in front of Congress, he claimed “Nothing about the crypto markets is incompatible with the securities laws.”
While Coinbase intends to relocate, Bittrex stated last month that it will cease operations in the United States. Even after the ruling was announced, the SEC initiated a lawsuit against the exchange. In the same case, the SEC designated six cryptocurrencies as securities: OMG Network (OMG), Dash (DASH), Algorand (ALGO), Monolith (TKN), NAGA (NGC), and IHT Real Estate Protocol (IHT).
