In the ongoing Coinbase versus the United States Securities and Exchange Commission (SEC) feud, the firm’s executives have expressed their frustration over the regulator’s behavior and have even resorted to threats.
On March 22, the SEC sent a Wells Notice to Coinbase informing them of a possible enforcement action over the “violation of federal securities laws.” The notice was concerning some of the firm’s asset listings, staking services, and Coinbase Wallet. Following the notice, the firm’s shares took a major hit and fell by almost 11.5%.
To this, Daniel Seifert, Coinbase’s Vice President and Regional Managing Director in Europe in a blog post emphasized that the U.S. government’s hawkish approach to crypto regulation has “left a vacuum that other countries are eager to fill.’
The blog titled “Europe is winning. Will the US catch up?” stressed that the “US regulatory approach to crypto has been marked by regulation by enforcement,” despite industry-wide calls for “comprehensive crypto regulation.” He added that this enforcement-driven approach has also given rise to confusion and instability in the crypto sector. Seifert wrote:
This approach has created an environment of uncertainty and instability in the crypto industry.
As such, Seifert implied that the U.S. is losing its status as the leading hub of the crypto sector, while France, the U.K., and the European Union, are now building “vibrant” ecosystems due to their friendlier approach to crypto regulation.
The US has left a vacuum that other countries are eager to fill. We are proudly an American company. It’s hard to sit by and watch the US squander the opportunity it has been given.
Further, he highlighted the significance of the Blockchain Week event being hosted in Paris. He also elaborated on the U.K.’s plans to become a crypto hub, and the EU’s Markets in Crypto-Assets (MiCA) regulation that is expected to come into effect in 2024, and the parliamentary discussion is scheduled for next month.
France is rapidly recognizing the opportunity that crypto presents and is offering it space to flourish. The broader EU, the UK, UAE, Hong Kong, Singapore, Australia, and Japan are all following suit.
Elaborating in the context of Europe, Seifert wrote in the blog that the MiCA legislation has been in development for two years, and aims to establish a “harmonized set of rules for crypto-assets and related activities and services.” It is generally expected to be a positive move for the European crypto ecosystem, as it will offer clear rules and guidelines for the sector and would also set an example.
He says “already we are seeing that Europe now matches the US in its share of crypto developers around 29% apiece globally. The US used to lead the charge with 40%.” He adds that such growth does not happen by chance and concerted efforts have to be made, such as developing a regulatory framework that will provide clarity and stability for businesses operating in the space.
Seifert’s opinion was also found to be similar to the Crypto Council for Innovation. The agency highlighted similar points saying that “crypto is global, and nobody is waiting around for the US to land the plane.”
Not just that, French Hill, a Republican lawmaker, in his DC Blockchain Summit appearance, pointed out that the regulator’s approach can be held responsible for driving crypto businesses away and hence there needs to be a more open approach involving perspectives to ensure efficiency.