An analyst at prominent financing management company, ARK Invest, has weighed in on the cryptocurrency regulatory issues in the United States. In a recent newsletter, ARK Invest’s analyst, Yassine Elmandjra, warned that the regulatory uncertainty in the United States puts innovation at risk.
The analyst further pointed out that this issue discourages existing and intending cryptocurrency corporations and could concede the United States position at the forefront of innovation to other countries.
Cryptocurrency Assets Regulatory Uncertainty Threatens Innovation In the US
In the newsletter, ARK Invest’s Elmandjra articulated the possible impacts and dangers of an unfavorable regulatory atmosphere to financing in the US.
The analyst cited the past few pullback in liquidity after Jane Street and Jump Trading retreated as the early indications of the broader ecosystem’s reaction to the unclear regulatory atmosphere.
Additionally, Elmandjra stated the United States cryptocurrency ecological system, once populated by well- established and credible institutions, is facing a void. And this void may discourage institutional investors from entering the industry.
In the analyst’s words:
The United States regulatory uncertainty appears to be discouraging existing corporations and new entrants in the cryptocurrency space.
Elmandjra likewise pointed out that digital currency liquidity in the United States has significantly declined, adding that Bitcoin (BTC) volume of trading dropped 75 percent in the last two months.
Citing data from Coin Metrics, the analyst stated Bitcoin volume of trading in the United States has reduced from $20 Billion per day in March to only $4 Billion in the last week.
United States Cryptocurrency Regulatory Environment Pushing Top Corporations To Look Elsewhere
Ark Invest’s newsletter comes as US-based cryptocurrency corporations consider expansion outside the country owing to an overwhelmingly hostile business environment for digital assets.
Plenty of corporations have complained about a lack of regulatory clarity while United States regulatory authorities incessantly crack down on them. In a recent development, Coinbase Crypto exchange sued the United States Securities and Exchanges Commission, demanding clarity on regulation.
This was after the exchange received a Wells Notice from the regulating authority threatening legal actions for alleged securities law violation.
At the recently concluded Dubai Fintech Summit, Coinbase Crypto exchange CEO Brian Armstrong said the UAE is more business-friendly than the United States in the case of cryptocurrency firms.
In a May 7 blog, the company pointed out that Armstrong and some other Coinbase Crypto exchange executives want to discuss the UAE’s potential to become a strategic hub for the digital exchange. It’s worth noting that, Coinbase Crypto exchange has already launched its international exchange and appears ready to move outside the US.
Brief On Ark Invest
ARK Invest is a notable US-based financing management company that manages exchange-traded funds (ETFs). The company had $50 Billion in assets under management in February 2021 before a downturn in May 22 pushed it down to $15.9 billion.
Regardless of the setbacks, ARK Invest remains an active pro- cryptocurrency investor and has purchased millions of Coinbase Crypto exchange exchange shares amid crashing prices.
Featured image from Pixabay and chart from Tradingview.com