Regulation
Coinbase reports flight of crypto talent from US amid regulatory concerns
In a report released earlier this week, Coinbase expressed concern about the decline in crypto talent in the United States amid the continued increase in general corporate interest.
The largest US exchange has highlighted the need for regulatory clarity in the cryptocurrency sector to retain talent within the country.
Declining developer talent in the US
CoinBase Notes a significant decline in US-based cryptocurrency developers, down 14 points over the past five years to just 26% today. Top Fortune 500 executives have expressed concern about the talent shortage, seeing it as a bigger barrier to cryptocurrency adoption than regulatory issues.
On the other hand, smaller businesses have expressed interest in seeking cryptocurrency-savvy candidates to fill future roles in IT, technology, finance and legal departments. About 68% of small businesses believe that blockchain and cryptocurrency can solve major financial problems: processing times and transaction fees.
Therefore, Coinbase states the need for clarity of cryptocurrency rules and regulations to retain developers in the United States.
Despite an apparent decline in cryptocurrency developers, the United States is seeing a significant increase in on-chain projects. For example, the number of Web3 initiatives by Fortune 100 companies increased by 39%. Additionally, about 56% of executives at Fortune 500 companies said their entities are working on on-chain projects such as consumer-facing payment applications.
The report highlights that following the approval of a Bitcoin spot ETF earlier this year, assets under management for Bitcoin spot ETFs have surpassed $63 billion as more reputable names enter the sectors of cryptocurrencies and blockchain.
Coinbase highlighted the vital need for a clear definition rules in cryptocurrency. The report noted that:
“The increase in activity highlights the urgency for clear rules for cryptocurrencies that help keep cryptocurrency developers and other talent in the United States, deliver on cryptocurrencies’ promise of better access, and enable U.S. leadership in the industry of cryptocurrencies globally.”
Senator Cinzia Lummis dubbed concern about the Biden administration and Gary Gensler’s strict stance on Bitcoin and digital assets. He warned that this approach could lead to the sector moving overseas, potentially impacting America’s leadership in financial innovation. Lummis called for a more accommodating environment to foster growth in the industry nationwide.
Other highlights from the reports
The Coinbase report also praised the efforts of various payment companies, including PayPal and Stripe, to make cryptocurrencies and, in particular, stablecoins more available.
Merchants using Stripe can now accept USDC payments, which automatically convert to fiat.
PayPal also supports transaction-free cross-border transfers in 160 countries, compared to the global standard of 4.45% to 6.39% average fees in the international remittance market.
Furthermore, 48% of F500 executives believe that cryptocurrencies have the potential to increase access to financial systems, and therefore banking, for the banked and unbanked. However, all this can be achieved if the United States takes leadership in the cryptocurrency industry.