Ripple CEO, Brad Garlinghouse, said in an interview that the crypto firms could very leave the U.S. due to the continuous crackdown by the regulators. He further added that the crypto firms might consider moving to regionswith more clarity such as Europe.
Garlinghouse also said that Europe has been playing a leadership role. “Even growth in the markets like the U.K. and Singapore are interesting since they offer more clarity about the regulations of digital assets.
Confusing Regulations Can Drive More Crypto Firms Outside of the US
CEO of blockchain services company Ripple, Brad Garlinghouse, said in a recent interview that many companies such as Ripple are now hiring talent and investing outside of the country.
He said the crackdown by the regulators and the uncertainty regarding the crypto regulations are impacted various firms and exchanges. On the other hand, other markets have made great progress, he added.
For instance, European and the UK have been working on regulating crypto assets while providing more clarity. Garlinghouse pointed out that doing so will allow entrepreneurs and traders to communicate constructively with the regulatory authorities.
When Garlinghouse was asked about the crypto giant FTX’s bankruptcy, he replied that the case of FTX can be called a “fraud” and has nothing to do with crypto.
He said that the U.S. has made it more and more confusing to know what the rules for the crypto industry should look like. “He said the SEC has been at the (Securities and Exchange Commission) is at the forefront of this perplexity.
Companies Taking Action against the Regulatory Authorities
The growing crackdown by the regulatory authorities has been a major concern for many crypto firms. However, some of them have put up a fight by taking relevant legal actions.
For instance, Coinbase took legal action against the SEC after the regulator didn’t give any response to its petition that it filed in June 2022.
The exchange firm a petition seeking clarity regarding whether its current existing securities rule-making mechanisms can be extended to the crypto industry. Additionally, the U.S. has also alleged Binance, of not following the compliance rules to solicit American consumers.
Binance is the largest crypto exchange globally and is also threatening to leave the US market after growing pressure from the regulatory authorities.
Continuous Crackdown by the US Regulator
There has been a growing concern regarding the irregularities in the US market. Lawmakers and investors are demanding a growing check and balance the crypto market saw a decline in its valuation by 66% in the crypto winter of 2022.
As a result, the Department of Justice (DOJ) which is the top US cryptocurrency regulatory authority is looking towards a tough crackdown on the digital platforms. The DOJ is promising on checking platforms with illicit behavior saying the crypto crimes have been increasing in the last 4 years.
The Department of Justice is now identifying various crypto companies and exchanges that don’t have a proper trail of transactions. Eun Young Choi is the newly appointed director of the agency’s national cryptocurrency.
She said in an interview that the DOJ plans on targeting all crypto companies, exchanges, and firms that commit crimes themselves or let others do so through their platform like allowing money laundering and terror financing.
Choi further added that the DOJ aims to target platforms so it would send a “clear message” to crypto businesses, companies, and exchanges that are not complying with the client identification or money laundering regulations.
The regulatory authority plans on targeting such companies that are not complying with and following the risk mitigation protocols.