Crypto.com Shuts Down US Institutional Exchange
Another exchange is shutting down in the U.S. Another NBA arena’s naming rights may be at stake.
Crypto.com just suspended their U.S. institutional exchange. They will no longer be serving institutional clients as soon as June 21st.
The timing makes sense, it’s been a news-packed week with the SEC, Binance and Coinbase. And this adds to a long list of others the SEC has targeted in 2023.
In addition to driving innovation overseas, regulatory fears have crushed demand for institutions to invest in the space. In a statement to Blockworks, Crypto.com said it was “due to limited demand from institutions in the U.S. in the current market landscape.”
Who Does This Affect?
Right now this only applies to institutions using Crypto.com. Retail users have been assured that the app will continue as normal.
And up until now they have not been a target of the SEC. They even have a derivatives product built into their retail trading app that is regulated by the Commodity Futures Trading Commission (CFTC).
Why Does This Matter?
While they are closing the door on U.S. institutions, they also just applied for a license to offer these same services in Singapore.
At the end of the day, it can all be tied back to one thing: Unclear U.S. Regulation.
It’s the same reason that Coinbase is exploring moving overseas. You can’t blame them. They have followed every rule in the book and tried to comply as much as possible. In return they were issued a lawsuit.
Crypto as an industry is going to carry on, with or without the United States.
So What Is Crypto.com?
Crypto.com was founded in 2016 and is located in Singapore. It was actually named Monaco when it was founded but the 4 founders scooped up the Crypto.com domain in 2018.
And Crypto.com is a fitting name. They do it all when it comes to crypto:
- First off, they are a centralized crypto exchange, they allow users to buy and sell crypto and they hold your assets for you.
- They started offering VISA cards with crypto rewards in 2018, becoming a major part of their business at the time.
- They were finally able to enter the US market in 2020 with their services and growth was explosive from there, reaching 5 million active users.
- They had a monster year in 2022, growing to over 50 million users and purchasing the naming rights for the Clippers NBA stadium.
To Sum It Up
Crypto.com has decided to suspend its US institutional exchange due to a lack of demand. Their retail trading will continue as normal and has been a massive driver in their success since launching in 2020.
But as regulations in the US are still unclear, institutions are discouraged from investing in the space. Others are forced to move overseas.
Despite this setback, Crypto.com has kept a significant role in the crypto space. With 5 million US users and 50 million worldwide, they have formed a loyal community and introduced several unique products.
Regulation may be a hurdle for the crypto industry in the US, but innovation will continue regardless.
