Mike Novogratz, the CEO of Galaxy Digital, a leading crypto investment firm, has revealed that he is contemplating moving his businesses outside the United States due to the country’s ongoing regulatory crackdown on the cryptocurrency industry. Novogratz cautioned that many other crypto companies are also considering similar strategies and relocating away from the US.
During the Piler Sandler Global Exchange & FinTech Conference, Novogratz expressed their intention to move personnel and companies out of the US. Several US-based crypto companies have already taken steps to establish their operations in other countries.
Novogratz believes that the US will continue to be an important player in the long run but emphasized the need for the country to engage with the crypto industry rather than disregarding it. He stated that for cryptocurrencies to realize their true potential, the US must be actively involved. Given the country’s significant role in the global economy, finding common ground through engagement with politicians and regulators is crucial.
Currently, the regulatory landscape for crypto businesses in the United States appears challenging. The US Securities and Exchange Commission (SEC) has heightened its scrutiny of crypto companies, filing successive lawsuits against major exchanges like Binance and Coinbase. The SEC alleges that these exchanges have violated investor protection laws, claiming that over 30 listed cryptocurrencies are unregistered securities.
Amidst the uncertain regulatory environment, several crypto companies have announced their plans to relocate overseas. Coinbase, the largest US-based crypto exchange, recently established a business presence in Bermuda and expanded services for customers in Singapore. Gemini, another prominent US-based exchange, is seeking a license in the United Arab Emirates and intends to grow its workforce in Singapore to target the Asian market.
Ripple, currently entangled in a legal dispute with the SEC, also expressed its intention to relocate its business outside the US. The increasing exodus of crypto businesses from the US and the growing regulatory uncertainty highlight the need for US regulators to establish clear and comprehensive guidelines for the industry. Failure to do so may result in further proliferation of offshore havens for crypto companies, hindering the country’s ability to fully participate in and benefit from the cryptocurrency revolution.
