Within hours of Facebook’s announcement that it was planning to launch Libra, its own cryptocurrency, US lawmakers had issued a response asking the company to delay. Alluding to the company’s “troubled past,” Democratic Congresswoman Maxine Walters stated that Congress and regulators should have “have the opportunity to examine these issues and take action.”
So far, lawmakers have been slow to put in place any regulations or guidelines specific to the burgeoning crypto markets. However, the comments from Congresswoman Walters appear to indicate that it’s inevitable that US regulators will intervene in Facebook’s Libra plans. If, or when, this happens, it will undoubtedly have broader ramifications for the entire sector.
Crypto companies have been watching these developments closely, and some are now taking action to address the looming specter of SEC regulation. Trading platforms such as Bancor, Binance, and Poloniex have now all taken steps to deter US users, in a bid to ensure that they avoid falling foul of any existing or future rules.
More Freedom to Operate
While US crypto traders will surely be disappointed by these steps, it could spell good news for the crypto space overall. Blockchain firms that avoid the US will have greater freedom to operate and innovate without the shackles of regulatory uncertainty holding them back.
Bancor is a good case in point. Currently, Bancor’s users can change any Ethereum ERC-20 or EOS tokens through the company’s liquidity network. A standard crypto exchange uses an order matching system to find buyers and sellers of any particular token, meaning that if liquidity is low, a trader could end up waiting for the exchange to find a match.
The Bancor liquidity network uses a relay token process.