“Thousands” quit in US due to cryptonegativity

Thousands of developers of the cryptocurrency industry have left the United States because of its negative attitude towards the sector, the head of one of the pioneer exchanges told an international forum on Thursday.

Despite a “wild year” of scandal and failure in 2022 when the FTX exchange and a number of crypto traders collapsed, Peter Smith, CEO of London-based Blockchain.com, told the Qatar Economic Forum that there is now “real growth” in the crypto community.

Smith, who said nearly a decade as head of Blockchain.com had left him with “no nerve endings”, recounted how other countries were taking advantage of the void left by the US where some regulators were “openly adverse to crypto”.

While some US lawmakers want to see regulations for a cryptocurrency market, regulators there have taken a hard line due to fears of money laundering and fraud like the FTX collapse. Former FTX CEO Sam Bankman-Fried will stand trial in New York in October.

“It has opened up opportunities for other countries,” Smith said.

“France, Portugal, the United Arab Emirates, Singapore, Hong Kong, London increasingly and interestingly, have all been very keen to pick up the slack that the US has created,” he said.

Other countries had been “very constructively” over-regulating and attracting “a huge amount of talent”.

“Thousands of incredibly talented people have left the United States to move to other jurisdictions in the past year,” Smith told the forum.

Before last year’s turmoil, Blockchain.com said it had more than 31 million verified customers. Smith said there has since been growth, particularly in Nigeria, Ghana, Colombia, Argentina and Ukraine.

“We invest in Singapore, we invest heavily in Europe, because they are the two most secure environments we have,” Smith said.

“It comes at the expense of investing in America. The vast majority of our resources and our investments are outside the United States.”

Regulators around the world have expressed concern about the lack of control over digital currencies, but there has been a trend in different countries towards regulating the market.

Singapore has proposed new regulations, and the 27-nation European Union last month approved the first comprehensive rules covering crypto-assets such as bitcoin and ethereum and tokens whose value is secured by blockchain technology.

EU ministers last week adopted measures to crack down on tax fraud using cryptocurrency.