Cryptocurrencies in the US: Moody's sounds the alarm

Moody’s is a well-known research and risk analysis company within the cryptosphere. On June 20, it published a most interesting report on crypto in the United States. Specifically, it highlights the political divisions in the US regarding crypto regulation.

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— Moody's Investors Service (@MoodysInvSvc) June 14, 2023

Lack of bipartisan support on crypto legislation

Crypto regulation in the United States has always been subject to debate. In its report, Moody’s particularly highlights the divergent approaches of Democrats and Republicans. The main source of disagreement concerns the supervision of stablecoins. Lawmakers are struggling to decide whether supervision should be exercised at the federal or state level.

But that’s not all! Consumer protection following crypto company bankruptcies in 2022 is also sparking heated debate. Democrats and Republicans agree on one point: consumer protection is paramount. To do this, clear and consistent crypto regulations should be established. Unfortunately, they adopt different approaches to achieve these goals.

Crypto companies often fall victim to regulatory vagueness in the US

The lack of regulatory clarity in the United States puts off a number of crypto companies. As proof, many of them have been fleeing the US territory since the beginning of the year. In conflict with the SEC, Coinbase chose to move to the United Arab Emirates in May. And Coinbase’s executives are not the only ones to do so.

This underscores an important fact: if U.S. lawmakers fail to establish a coherent crypto regulatory framework, the U.S. risks losing its attractiveness to this fast-growing industry.

Crypto companies believe that the lack of bipartisan support and regulatory clarity hinders their growth in the United States. Faced with legal proceedings and regulatory uncertainty, they consider other jurisdictions as more attractive alternatives to develop their businesses.