US-based cryptocurrency exchange Poloniex felt compelled to delist 9 altcoins beginning May 29, 2019. Now, American users on the Poloniex exchange will no longer be able to trade these altcoins, five of which were Top 100 Coins. Again, US crypto enthusiasts are feeling the burden of an uncertain regulatory environment.
First off, let’s see which coins were given the axe by Poloniex. Those with an asterisk after the altcoin name are in the top 100 coins according to CoinMarketCap:
- Ardor (ARDR)*
- Augur (REP)*
- Bytecoin (BCN)*
- Decred (DCR)*
- Game Credits (GAME)
- Gas (GAS)
- Lisk (LSK)*
- Nxt (NXT)
- OmniLayer (OMNI)
However, according to Circle, the company behind Poloniex, users outside of the US will not feel the effects. They can still trade the 9 US-banned coins.
Who is Poloniex?
Poloniex is a centralized crypto exchange that has been in operation since January 2014. Founded by Tristan D’Agosta, the company was bought out in 2018 by Goldman Sachs-backed Circle Internet Financial, a payments platform.
The deal, involving $400 million, had SEC approval on the condition that the exchange register the new entity with FINRA and the SEC for brokerage activities. Since that point, Circle has done everything it can to bring Poloniex under compliance. All this despite its disagreements with the stance American regulators have taken in regards to crypto.
Why did Poloniex delist these altcoins?
The main reasoning behind the delisting has to do with the lack of cohesive guidance from the American regulators.
Circle’s CEO, Jeremy Allaire, took to Twitter to express his frustrations. To him and other US industry leaders in the crypto market, this lack of clarity is restrictive to forward movement and innovation.
The US’s cryptocurrency regulation track record
The US has historically lagged behind other countries in Europe and Asia when it comes to regulating digital assets. One example is the continued delaying of a decision on bitcoin ETFs. Another is the SEC’s recent ICO guidance, which leaves little if any room for growth and innovation in the crypto sector. Already, teams running ICOs all over the globe have excluded American participants because of the SEC’s stance.
“Recent guidance from US regulators on what crypto assets would be deemed securities has led to these actions. We don’t agree that they should be considered securities but need to ensure we are in compliance with US law.” – Jeremy Allaire, CEO Circle
Overall, the US regulatory focus has been on tightening controls and using outdated laws to attempt to cover a brand new asset class.
Just last week, a US Congressman Brad Sherman submitted a bill to ban all cryptocurrencies. His reasoning is that the only useful advantages of cryptocurrencies are to engage in illegal activities, evade taxes or disempower the US government. This type of thinking completely misses the point of cryptocurrencies and exposes US government officials with little understanding of crypto who are setting the tone.
Financial freedom and privacy are the main advantages of cryptocurrencies and are considered by many to be rights that all should have, similar to freedom of speech. It’s obvious that the many crypto industry leaders present at Consensus 2019 are not in it for “nefarious activities” as Sherman unwittingly postulates.
Now, this public delisting by Poloniex further exposes a problem for the American crypto industry. From investors wanting to trade to innovative blockchain startups trying to create their foundation, US residents keep finding themselves on the fringe of a booming, worldwide industry.
Also published on Medium.