Coinbase CEO Quits US If Crypto Regulatory Clarity Doesn’t Improve

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Cryptocurrency broker Coinbase Global could leave the United States where it is one of the few major publicly traded digital asset firms if regulatory clarity in the sector does not improve, its CEO said.

The United States has the potential to be an important market for crypto, but right now we don’t see the regulatory clarity we need, Coinbase (ticker: COIN) CEO Brian Armstrong said during an interview. from a keynote address at a fintech conference in London, CoinDesk reported on Tuesday. I think in a number of years, if we don’t see that regulatory clarity emerging in the United States, we may have to look at investing more elsewhere in the world. Everything is on the table, including relocation or whatever is necessary.

Coinbase confirmed Armstrong’s comments to Barrons but declined to comment further. The company is based in the United States and was headquartered in San Francisco before becoming a remote first company during the Covid-19 pandemic.

Shares of Coinbase rose 1.3% on Tuesday, advancing in line with the price of Bitcoin, the largest digital asset.

The closest thing to a blue-chip crypto, Coinbase has faced increasing headwinds from the regulatory landscape in the United States, where lawmakers and regulators have intensified their scrutiny of the digital asset industry over the past of the last year. The pressures have intensified since the collapse of crypto exchange FTX last November amid allegations of fraud.

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Coinbase, for its part, revealed last month that the Securities and Exchange Commission sent it a so-called Wells notice. This means that agency staff have decided to recommend an enforcement action; Coinbase said it believes it will target its core trading operations as well as an interest-bearing service, institutional trading solution, and custodial business.

At the time, the company said it was confident in the legality of its assets and services, and would welcome legal proceedings if necessary to provide the clarity it advocates.

Armstrong said it could take years of regulatory uncertainty for Coinbase to decide to leave the US

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Such a move probably doesn’t make sense now, as the group would likely face regulatory pressure from the United States even if it moved overseas. Moreover, abandoning the US market altogether would have serious consequences for the company, as it now exists as one of the most popular crypto retail platforms in the US.

Write to Jack Denton at [email protected]

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