Brian Armstrong, the CEO of U.S. crypto exchange Coinbase Global Inc, has called for the United States and the United Kingdom to establish clearer rules for the cryptocurrency industry.
Speaking at the Innovate Finance industry conference, Armstrong emphasized the importance of avoiding the development of offshore havens by providing a clear regulatory framework for crypto firms.
Offshore havens and regulatory challenges in the U.S.
Armstrong’s comments come in the wake of the Bahamas-based FTX exchange’s failure last year, which highlighted the need for major economies to create transparent crypto regulations.
Armstrong warned that without clear legislation and regulation in the U.S. and the UK, firms may be built in offshore havens, potentially leading to more market disruptions and fraud.
While the European Union has drafted specific crypto rules, the sector remains largely unregulated in the United States. U.S. regulators and law enforcement have initiated a widespread crackdown on crypto companies this year, targeting illegal offerings and failures to comply with rules designed to prevent illicit activity.
In March, the U.S. Securities and Exchange Commission threatened to sue Coinbase over certain products.
British efforts and bank hardline
In February, the British finance ministry introduced its first set of rules to regulate cryptocurrencies, with the UK’s financial watchdog calling for stringent rules to “detoxify” the sector in March.
Armstrong applauded the UK’s fast-paced approach to sensible crypto regulation in a tweet on Monday, stating that he was “excited to keep investing in the UK.”
However, Armstrong expressed concerns over some UK banks adopting an increasingly hardline stance towards customers transferring money to crypto exchanges in an effort to combat fraud.
For example, NatWest, a top UK lender, imposed new limits on customer transfers to cryptocurrency exchanges in March to protect consumers from “crypto-criminals.”
Armstrong criticized the banks’ actions, tweeting that blocking fiat payments to crypto companies is “not ok” and that while good fraud controls make sense, a blanket ban does not and is likely unlawful.
The Coinbase CEO’s comments reflect the urgency for the U.S. and the UK to provide a transparent and robust regulatory framework for the rapidly evolving cryptocurrency industry.
