ArK Investment: Uncertainty in US Cryptocurrency Regulation to be Surpassed by UAE, South Korea, and Switzerland in Crypto Industry

In the past six months, several mainstream trading firms and large exchanges in the United States have been reducing their participation in the US crypto market in response to regulatory uncertainties and risks. ARK Invest, an investment firm, issued a warning in a report to its clients, stating, "The United States may lose its international leadership position in the financial markets."

ARK Invest Analyst: U.S. Crypto Ecosystem Facing Void

ARK Invest, founded by current CEO Cathie Wood, is a global asset management company currently holding over $14.1 billion in assets. In a report to clients on the 23rd, their analyst Yassine Elmandjra expressed concerns about the exodus of U.S. crypto companies with the theme "Regulatory Uncertainty Around Digital Assets Puts Innovation in the United States at Risk."

He added: "The U.S. crypto industry ecosystem once had mature and reliable institutions as benchmarks; however, the exodus due to regulatory uncertainty will quickly leave it in a void, slowing down investments from other institutions and investors, and hindering the development of existing and new companies in the crypto field."

As early as three weeks ago, U.S. Congressmen Warren Davidson and Mike Flood had sent an open letter to CEA Chairman criticizing that if the U.S. continues to view crypto assets with a hostile stance, it will lead to the continuous exodus of this innovative technology overseas, causing the U.S. to lose capital, miss out on economic growth opportunities, and allow other countries to take the lead.

Coinbase Exodus, Dubai Takes Over?

Including the international expansion strategy "Go Broad & Go Deep" of U.S.-listed cryptocurrency exchange Coinbase, and the unfavorable news of a 30% mining energy tax for Bitcoin mining company Bit Digital, they are expanding their crypto mining footprint in Iceland. Many crypto companies have quietly begun to shift some of their business content or seek to expand overseas due to the changing statements and positions of the U.S. government, SEC, and CFTC.

It is worth mentioning that in March 2022, the UAE established a legal framework for cryptocurrencies in its international financial center Dubai and set up a crypto asset regulatory body, which formulated additional regulations for its free trade zone to attract funds and create job opportunities. Recently, Coinbase CEO Armstrong also visited the UAE, where discussions were held on the potential for the UAE and Dubai to become a "strategic hub" for cryptocurrency exchanges, indicating Coinbase's determination to move away from the U.S.