Erik Weijers, 2 months ago
The United States government is tightening the screws on crypto companies. While this may be considered a worrying development, it's by no means crypto's death knell. Other countries are clearly standing in line to embrace the talent and the money that this fledgling industry provides. The United Kingdom is one such example.
The American financial watchdog SEC is 'regulating by enforcement'. Meaning, lacking a clear regulatory framework, they sue left and right.
Some examples of the tough love that crypto gets in the US:
Only a year ago, crypto lovers in the EU were a bit grumpy about a new package of regulation - MICA - that will go into effect in 2024. But at least the EU will have a regulatory framework, which is better than a government leaving the crypto industry in the dark whether they are compliant or not. The latest guidance on crypto assets in the US, dates to 2019, and doesn't even mention the concept of staking. This lack of clarity scares any crypto startup that can't afford spending millions on lawyer fees.
So, in which direction are these crypto startups pulled? The United Kingdom is one such candidate. Its prime minister, Rishi Sunak, announced he wants to make the UK a crypto hub.
Well, let's see what the UK says about its stance on crypto regulation:
[the UK government wants to] “….establish a proportionate, clear regulatory framework, which enables firms to innovate at pace, while maintaining financial stability and clear regulatory standards”.
That sounds already better!
As an example of this clear framework, steps in the UK to regulate fiat backed stable coins in are under way. Also, the UK government is explicitly open to Decentralized Finance.
Will governments ban crypto? While nothing can be ruled out, there are game theoretic forces that push in a different direction. The crypto industry will bring innovation, talent, and money to any country that choses to embrace it. One nation's refusal to go along with it, is another nations' gain.
Historically, the financial center of the world has flipped between London and New York, the current center of the financial world. Will the pendulum swing back? By the way, there are more contenders: Hong Kong, Singapore, Dubai, El Salvador, and - within the EU - Portugal, are very crypto-friendly.
May 18, 2023
Many crypto enthusiasts and the broader crypto industry had high hopes for the UK to become the biggest crypto hub next to Europe. An open and efficient regulatory framework was promised, and it was believed that crypto would soon thrive in the country. A royal NFT mint was one of the many indicators that these plans are more than just make-believe. The expectations for crypto in the UK have changed all of a sudden.
May 10, 2023
Robert F. Kennedy junior ('RFK Jr.', 1954) is a 2024 Democratic Party presidential candidate who is pro Bitcoin and crypto. Like many politicians who challenge the incumbents, he presents himself as anti establishment and defends civil liberties like free speech. Let's investigate his views on crypto and his chances to win.
May 06, 2023
On May 4, Argentina's central bank banned payment providers from offering and accepting crypto. Payment providers now fall under the same rule as financial institutions in the country. It appears to be a form of 'capital control' - but it won't prevent Argentinians from owning crypto.
Apr 25, 2023
The SEC is wreaking regulatory havoc in the US. At least that’s the perception of some members of Congress who aren’t happy with the SEC’s approach. Coinbase is particularly unhappy since the company received a Wells notice which could lead potentially to a lawsuit against the US-based exchange. But there is more to that story. In July 2022, Coinbase asked for regulatory clarity by filing a petition to the SEC.
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