LONDON, April 18 (Reuters) – The United States and Britain should make their rules on the crypto industry much clearer to prevent firms from developing in “offshore havens,” the head of U.S. crypto exchange Coinbase Global Inc ( COIN.O ) Brian Armstrong , said Tuesday.
The failure last year of the Bahamas-based FTX exchange has highlighted the importance of major economies developing clear crypto regulations, Armstrong said at a conference held by industry body Innovate Finance.
“This is why we need clarity on legislation and regulation onshore, because if the UK doesn’t have this, if the US doesn’t have this, these firms are going to be built in offshore ports,” Armstrong said.
While some major economies such as the EU have drawn up tailored crypto regulations, the sector remains largely unregulated in the US.
US regulators and law enforcement have launched a broad crackdown on crypto companies this year, targeting illegal offerings and failure to comply with rules designed to prevent illegal activity. In March, the US Securities and Exchange Commission threatened to sue Coinbase over certain products.
Still, the UK Treasury in February laid down its first set of rules to regulate crypto, with its financial watchdog in March calling for tough rules to “detoxify” the sector.
In a tweet on Monday, Armstrong said the UK was “moving quickly with sensible crypto regulation,” adding, without elaborating, that he was “excited to continue investing in the UK.”
Still, he expressed concern that banks in the UK are taking an increasingly tough approach to customers transferring money to crypto exchanges in a bid to stamp out fraud.
Top British lender NatWest ( NWG.L ), for example, introduced new limits in March on customer transfers to cryptocurrency exchanges, to protect consumers from what it called “cryptocriminals”.
“Some UK banks are blocking fiat payments to crypto companies, which is not ok,” Armstrong tweeted, referring to traditional currencies.
“Good fraud controls make sense, a blanket ban doesn’t (and probably isn’t legal).”
Reporting by Tom Wilson, editing by Elizabeth Howcroft
Our standards: Thomson Reuters Trust Principles.
Tom Wilson
Thomson Reuters
Tom covers crypto companies, regulation and markets from London, focusing through 2022 on the Binance crypto exchange. He has worked at Reuters since 2014, with a previous posting in Tokyo where he exposed abuses in Japan’s immigration system and won a joint Overseas Press Club award for reporting on tobacco giant Philip Morris.
Elizabeth Howcroft
Thomson Reuters
Reports on the intersection of finance and technology, including cryptocurrencies, NFTs, virtual worlds and the money that powers ‘Web3’.
