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Home Blog crypto exchanges exodus
Article by Yunis
4 April 2023 (Updated 12 June 2024)

Crypto Exchanges Seek Regulatory Heaven Outside of the US

Several major cryptocurrency exchanges, including Kraken and Bittrex, have recently announced their departure from the United States due to regulatory challenges. Meanwhile, Nexo has been hit with a penalty by US regulators, and Binance is also facing regulatory difficulties. These developments have raised concerns about the future of the US crypto market and its ability to compete with more crypto-friendly jurisdictions.
Crypto Platform News - March 2023
  • The SEC expands its crypto-asset enforcement teams.
  • Crypto-friendly banks Silvergate and Silicon Valley collapsed.
  • Once the leader Bittrex is leaving the US market.
  • Nexo is fined $45 million for Earn Interest Products.

Crypto Exchanges Exodus from the US

Many crypto exchanges stop operations among the regulatory uncertainty about cryptocurrencies and exchanges in the US. The more debates about regulations of crypto exchanges escalate, the more difficult decisions the exchanges have to make to sustain their operations because the current situation is economically not viable.

How it started

Crypto markets have created terrible collapses and crashes that led millions of people to lose their life savings since the start of 2022 and more people raised their voices and called for regulations for cryptocurrencies and services related to crypto. It is known that the SEC nearly doubled its teams specializing in crypto-asset enforcement since 2022 and the SEC started executions at the beginning of 2023. SEC insist on regulations and bringing crypto service-providing companies to come in line with laws and provide a better structured legal background. SEC chairman Gary Gensler is very serious about classifying cryptocurrencies as securities. The target is not limited to the classification of cryptocurrencies but includes crypto exchanges and platforms that perform lending, borrowing and yield services. While some exchanges prefer to make a deal with the SEC and stay in the US market, some others prefer either to stop or leave the US market.

The collapse of two crypto-friendly banks; Silvergate and Silicon Valley Bank

Another major downfall in crypto is the collapse of two banks in the US because the banks are known for their crypto-friendly investments and relations. Silicon Valley Bank mostly works with new tech startups and provides them capital to sustain their early-stage operations to grow up until they are profitable. Many crypto startups have an account and loans with the SVB. Silvergate has partnerships with many crypto exchange companies to provide them with fiat currency payments. Silvergate acts as bridge between digital finance and traditional finance.

Bittrex stops US operations

Bittrex is one of the leading crypto exchanges in the US for almost a decade and they share a sad announcement on their ninth anniversary on the last day of March. Bittrex’s official Twitter account shared a tweet stating that Bittrex will stop operations in the US due to regulatory uncertainty. Bittrex also told its customers to withdraw their funds before April 30 and Bittrex Global will continue its operations as usual in the same tweet. Co-founder and CEO Richie Lai later shared a goodbye letter on Twitter for US customers.

Nexo stays but limits services

Nexo is a pioneering crypto exchange platform with ongoing efforts to comply with laws and become a regulated crypto service provider. The platform claims to be the world’s most regulated digital asset institution. The Nexo company got its share from the SEC’s heat and got troubled over its Earn Interest Product (EIP). Nexo agreed to pay a $45 million fine because of the products and promised to stop offering the earn accounts. Nexo doesn’t offer yield-generating earn accounts in the US anymore. It seems like Nexo plans to stay in the US and adjust its operation to the new environment. Nexo was using the domain name nexo.io until this month and they finally achieved acquiring nexo.com domain name. The company will be available on nexo.com with a new design. The company also announced new upgrades to its apps.

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