News What Trump Suing BTC-e Means for Crypto Adoption in...

What Trump Suing BTC-e Means for Crypto Adoption in the US

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Last week, the Trump administration’s Department of Justice filed a $100 million civil suit against old-school cryptocurrency exchange BTC-e for providing all kinds of financial services to US citizens without complying with the country’s regulations. A new world is coming, and it may represent a major shift in the makeup of the global cryptocurrency economy.

Crypto businesses are going to hate dealing with US customers

There’s no two ways about it: companies are not going to want to service customers living in the US. The hassle of dealing with regulators is simply too high. Now naturally, this is a major country representing a lot of higher-income customers, and shutting the country off means losing their business. However, the additional financial reporting required, and the threat of major regulatory crackdown, all for one lone country, will probably make it not worth it. The costs and burden necessary just to serve a lone group of customers is likely larger than the profit from their business.

The “wild west” days will come back to haunt many of the careless

Back in the old days, cryptocurrency was very new and experimental. It was a system of digital online tokens that could be created by simply running a program on your computer. Plenty of people had fun experimenting with it having no real sense that they were playing around with potentially millions, if not billions, of dollars in the future. A strictly-regulated future of blockchain analysis and criminal arrests. Some may have thought that those days of clandestine exchanges, throwing around thousands of coins on a whim, and not keeping proper accounting would be considered “old news” and eventually be forgotten. It turns out that these digital skeletons in the digital closet may be discovered and punished after all.

The US will likely become a place of “safe” crypto investing

As a result of all this, crypto businesses in the US will all get into tip top regulatory shape. Citizens will be able to buy and sell, make profits and lose money, all in a safe and well-regulated manner. Unfortunately, that also leaves little room for innovation and economic expansion. Quick crypto-to-crypto flipping services like ShapeShift have already seen their business affected, and it’s easy to see more models quickly come to the conclusion that a stifling regulatory framework just isn’t feasible for what is being accomplished. Americans may largely invest, trade, and do research and development, but not do much else such as innovate in the business and experimental applications realm.

The rest of the world will pull away in terms of innovation

It’s a big world out there. A key benefit of cryptocurrencies is their decentralized, censorship resistant, and borderless nature, and when something isn’t easily possible or feasible in one part of the world, it simply will move to another. Radical experimentation with micro-tipping based models, online gaming, small business, and countless other applications for decentralized digital money exist, and they will be found. They just will likely be found outside of the confines of the US. In a world where economic progress is expanding at lightning pace, this may create a major upset in the global distribution of wealth.

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