Coinspeaker
GameStop to End Crypto Wallet Support Due to ‘Regulatory Uncertainty’
American video game retailer GameStop Corp (NYSE: GME) has announced ending its support for crypto wallets. The move takes place just one year after launching the service.
Starting from November 1, customers will no longer be available to access iOS and Chrome Extension wallets. The company explained such a decision by the lack of proper regulation in the industry.
GameStop website reads:
“Due to the regulatory uncertainty of the crypto space, GameStop has decided to remove its iOS and Chrome Extension wallets from the market. We advise that all customers ensure that they have access to their Secret Passphrase by October 1, 2023. Any customer with access to their Secret Passphrase has the ability to recover their account in any compatible wallet.”
GameStop wallet was launched back in May 2022. Being a self-custodial Ethereum (ETH) wallet, it allowed users to manage cryptocurrencies and non-fungible tokens (NFTs). Besides, it enabled transactions on GameStop’s NFT marketplace, which was introduced later, in July 2022. The non-custodial Ethereum Layer 2-based marketplace allowed creators, collectors, gamers, and other community members to buy, sell, and trade NFTs.
The launch of the NFT marketplace was a shift in GameStop’s strategy to focus on digital sales rather than brick-and-mortar locations. Both the GameStop crypto wallet and the marketplace releases took place when the NFTs industry was still skyrocketing. However, in the second half of 2022, NFTs fell in popularity. Overall, NFT transaction volume in 2022 slowed down dramatically. From January 2022 to September 2022, NFT trading volume collapsed by 97%, from $17 billion in value to just $466 million.
Regulatory Scrutiny on Crypto Industry
The US regulators have doubled down on their efforts to crack down on crypto-related companies. The US Securities and Exchange Commission (SEC) has filed numerous lawsuits, and the biggest crypto exchanges Binance and Coinbase Inc (NYSE: COIN) faced scrutiny as well. Binance and Coinbase have both been alleged to have violated the law by operating as securities exchanges without registering their businesses with the SEC. Recently, the SEC also claimed that Binance was often involved in wash trading.
The US Commodity Futures Trading Commission (CFTC) has been tough on crypto companies as well. The institution has accused Binance and its CEO Changpeng Zhao of illegally serving US clients. CFTC also claimed that Binance’s reported trading volume and profitability came from “extensive solicitation of and access to” US customers, contradicting the exchange’s claims.
Another trading platform Robinhood Markets Inc (NASDAQ: HOOD) saw the delisting of all the tokens named as securities in the recent SEC lawsuits. As a result of the regulatory crackdown on the crypto sector in the US, Robinhood is now looking to launch in the United Kingdom.
Currently, the opinions of the US government on crypto are differing. The authorities fail to agree on the final regulation of the industry. Last week, the US House Financial Services Committee passed a bill aimed at defining whether cryptocurrencies are securities or commodities. The bill also seeks to increase the Commodity Futures Trading Commission’s oversight over the crypto industry and clarify the jurisdiction of the SEC.
GameStop to End Crypto Wallet Support Due to ‘Regulatory Uncertainty’
