America’s crypto renaissance is already failing; but we can fix it
Launching a crypto project in the US faces significant challenges due to legal ambiguity and a hostile regulatory environment, pushing founders to offshore jurisdictions like Switzerland and the Cayman Islands. Despite claims of a pro-crypto stance under the Trump administration, regulatory clarity remains absent, with the SEC's outdated Howey test classifying most crypto projects as securities. This classification deters liquidity providers and centralized exchanges from engaging with US-based projects, leading to a loss of talent and investment. Offshore legal firms thrive as US founders navigate complex regulations, incurring unnecessary costs. To regain leadership in crypto, the US must create a new legal framework that accommodates the unique nature of crypto tokens, moving away from punitive regulatory practices and providing clear guidelines for market makers. Immediate action is necessary to prevent further erosion of the crypto industry within the US.
