Tech billionaire and Bitcoin bull, Chamath Palihapitiya, has claimed that the cryptocurrency sector in the United States has been choked out by regulators to the point of death. He made the statement in response to the news that cryptocurrency exchange Coinbase is now considering a move offshore. Palihapitiya also pointed the finger at Gary Gensler, the chair of the U.S. Securities Exchange Commission (SEC) and said, “Crypto is dead in America. I mean now you have Gensler even blaming the banking crisis on crypto — so the United States authorities have firmly pointed their guns at crypto.” Palihapitiya did concede that the crypto sector has “pushed more boundaries” than other startup sectors, which may have attracted the SEC’s attention. However, he believes that the good actors are now “paying the price” for the bad work done by FTX and other firms that have impacted the reputation of the industry. “The bill has come due for them,” he added.
Crypto regulation has been a hot topic in the U.S. lately. The SEC has been cracking down on unregistered securities offerings, such as initial coin offerings (ICOs), and has also taken action against cryptocurrency exchanges that it deems to be operating illegally. The Biden administration is reportedly looking to increase tax reporting requirements for cryptocurrency transactions and has also proposed a provision in its infrastructure bill that could require crypto exchanges and other service providers to report certain transaction data to the IRS. Despite these regulatory hurdles, many in the industry remain optimistic about the long-term prospects of cryptocurrencies, and some have even argued that increased regulatory clarity could help to further legitimize the sector.