Thousands of cryptocurrency industry developers have left the United States because of its negative stance towards the sector, the head of one of the pioneer exchanges told an international forum Thursday.
Despite a “wild year” of scandal and failure in 2022 when the FTX exchange and a number of crypto dealers collapsed, Peter Smith, chief executive 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”, told how other countries were taking advantage of the void left by the US where some regulators were “openly negative about crypto”.
While some US legislators want to see rules for a cryptocurrency market, regulators there have taken a tough line because of fears of money laundering and scams such as the FTX collapse. Former FTX chief Sam Bankman-Fried is due to go on trial in New York in October.
“It has opened up opportunities for other countries,” said Smith.
“France, Portugal, the United Arab Emirates, Singapore, Hong Kong, London increasingly and interestingly, have all been very excited to take up the slack that the US has created,” he said.
Other countries had been “very constructive” over regulation and attracted “a huge amount of talent”.
“Thousands of incredibly talented people have left the US 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 clients. Smith said there has since been growth notably in Nigeria, Ghana, Colombia, Argentina and Ukraine.
“We are investing in Singapore, we are investing heavily in Europe, because they are the two most certain environments that we have,” Smith said.
“That is coming at the expense of investing in America. The vast majority of our resources and capex investments are outside the US.”
Regulators worldwide have expressed concern about the lack of control of digital currencies but there has been a trend in various countries toward 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 with blockchain technology.
EU ministers last week agreed measures to crack down on tax fraud using cryptocurrencies.