Amid deep regulatory uncertainty in the United States, several cryptocurrency firms consider sailing to more welcoming atmospheres. Top US-based firms Ripple and Coinbase, who’ve been cross-chairs with the Securities and Exchanges Commission (SEC), have already hinted at possible relocation. Reacting to the issues, two CNBC correspondents, Ryan Browne, and Arjun Kharpal, weighed in.
According to the journalists, crypto companies like Ripple and Coinbase are playing a poker game with the SEC.
Crypto Firms Threaten Relocation To Ease Regulatory Pressure
The regulatory atmosphere in the US crypto space has become supercharged over the past few months as the SEC accelerated their crackdown moves against crypto companies. The SEC turned its attention to Coinbase, Binance, Bittrex, and Kraken amid long-running litigation with Ripple.
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These firms aren’t comfortable with the increased enforcement threats from the regulators as they complain the SEC has taken the regulation-by-enforcement approach without providing any clear guidelines for them.
Coinbase and Ripple even threatened to relocate their business outside the US, hoping regulators would reconsider their hawkish stance.
The CNBC correspondents further noted that Ripple executives joined forces to publicly criticize the SEC and gain support from the broader crypto community.
Prioritizing Politics Over Policy Is Unfavourable for the Economy, Ripple CEO Says
In their report, Browne and Kharpal quoted Ripple CEO Brad Garlinghouse, who, as a US citizen, expressed his disappointment with the situation.
In a statement, Garlinghouse said, “The US is getting passed not just by a little bit but by a lot.”
Garlinghouse claims more challenging is the fact that the US considers politics over policy, an unfavorable decision for investors. On most occasions, the SEC repeatedly argued that nearly all crypto tokens in the market constitute securities.
That was why the regulator sued Ripple in December 2020, accusing the firm of offering XRP as an unregistered security. However, Ripple has continued to contest this issue in court with the SEC, hoping to get a favorable ruling soon.
The SEC did not only point fingers at Ripple, as it recently came at Coinbase, issuing a Wells Notice alleging possible securities law violation.
Crypto exchange Kraken suffered the same fate and had no choice but to discontinue its staking services in the US with a settlement of $30 million.
The SEC claims its moves are to protect Americans from crypto investment risks. However, pro-XRP lawyer, John Deaton, asked the SEC chief, Gary Gensler, to stop claiming to protect the American public against crypto.
These regulatory actions have attracted reactions from industry figureheads, including Cardano founder Charles Hoskinson. Hoskinson urged crypto enthusiasts to support pro-crypto policies in the next elections to stop regulatory issues.
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