For many years, many have predicted that America’s relentless aggression toward the crypto sector will take a heavy toll on the nascent industry’s growth. They may have significant cause to believe, as various factors are pointing to development in other jurisdictions as far away from Uncle Sam as possible.
Others also believe in the so-called Operation Chokepoint 2.0, a conspiracy theory that says regulators are ganging up on crypto in a coordinated way to monopolize the development of the sector in the US.
While there is no conclusive evidence to say that this conspiracy theory is anything but, the overwhelming amount of pressure being faced by many US-based crypto firms could almost convince them to believe in it.
In this article, CNL explores the chronic predicament of many crypto firms in the US and what hope there is for them.
It May Be Sam’s Fault
Since the high-profile collapse of FTX, other crypto firms in the US are suffering constant tight scrutiny from regulators and those who are unlucky get sued.
Earlier today, CNL reported that Bitcoin of America executives have been charged with running unlicensed crypto kiosks in the state of Ohio. Paxos, Binance’s partner in issuing Binance USD (BUSD), also received orders to stop issuing the stablecoin after the SEC claimed it is a security token.
Kraken also closed its staking program without a fight after being attacked by the SEC. This alarmed other US-based crypto exchanges including Coinbase, which is also operating its own staking program.
Celebrities like Kim Kardashian, Logan Paul, and many others were also forced to pay huge amounts of money for their endorsement of crypto projects.
To be fair, prior to the endless controversies surrounding Sam Bankman-Fried’s (SBF) Alameda Research meltdown, the SEC has always been tough on crypto. The securities watchdog recently won over Web3-based file-sharing website LBRY, while its lawsuit with Ripple is about to conclude.
However, the picture is clear: the US does not want any crypto company to thrive unless it is subject to its whims. Therefore, the clear solution is for crypto companies to seek refuge on other shores — and that is exactly what they are doing.
Growth in the Far and Middle East
Leading crypto exchange Binance is starting to give up on its goal of acquiring Voyager. In fact, CEO Changpeng Zhao’s latest remark is to just “pull out” of the deal because of the intense scrutiny it is getting from regulators.
Binance is now seeking partnerships with other governments instead, with hopes of stoking cordiality with them for the long haul.
Now, crypto companies are setting their eyes on Hong Kong and China. Particularly in Hong Kong, the Securities and Futures Commission (SFC) published the proposed provisions of its forthcoming crypto regulation. Huobi Global, another crypto exchange frontrunner, grabbed the opportunity and filed a crypto license application in the said jurisdiction.
Meanwhile, China is relaxing its grip on tech industries, including crypto. Last week, Chinese officials have been observed to be approving Hong Kong’s goal of becoming a crypto hub. In fact, another official said in a speech that China ought to reconsider its crypto ban.
Of course, the Middle East remains a favorable place for crypto innovation. In fact, many crypto influencers who were previously from the US and Europe are moving to Middle Eastern countries like the United Arab Emirates and Qatar.
A Bit Further East
A little bit more East and there is Australia, a country that seemed to have lagged behind others in crypto innovation. However, it would be unwise to count Australia out, as some crypto firms are already positioning themselves to become the trailblazers should the crypto fever begin in the Land Down Under.
Finally, Australia is about to finalize its own crypto regulation next year. Regulators are taking their time to ensure a citizen-friendly amendment in the country’s Treasury laws.
All Eyes on Ripple
As for the US, crypto firms do not need to abandon all hope. The upcoming ending of the SEC vs Ripple lawsuit will set an important precedent and according to many legal experts, Ripple has a good chance of winning.
Should Ripple win against the SEC, the US could become the crypto industry’s favorite destination overnight due to clear regulation. But if Ripple loses the lawsuit, the company may decide to take the matter to the Supreme Court where it has a higher chance of winning.
Unfortunately, if Ripple loses the case again, then it only means one thing: the US will have to move over for good because Asia will become the uncontested hub for crypto.
So, all eyes are now on the Ripple case.
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