Senator Elizabeth Warren's Digital Assets Anti-Money Laundering Act, Ethereum Shapella upgrade and more

Crypto Firms Flee US Over Regulatory Uncertainty

U.S. Senator Cynthia Lummis and other experts express concern about the lack of regulatory clarity in the U.S. for cryptocurrencies, causing crypto companies to move overseas to friendlier jurisdictions. Countries like Europe, Australia, the U.K., and Switzerland are seen as more advanced in terms of their regulatory frameworks.

Crypto-focused lawyer Jason Gottlieb confirms the trend, citing young entrepreneurs moving to places like the Cayman Islands, Portugal, and Singapore. The potential exodus of crypto talent could impact the U.S. economically and even in terms of national security, as the next generation of the internet will be built on top of crypto networks.

Warren's Crypto Bill May Stifle Innovation

Senator Elizabeth Warren's proposed Digital Assets Anti-Money Laundering Act aims to protect Americans from scams but may drive cryptocurrency businesses overseas and limit consumer choice. The bill places excessive regulatory burdens on crypto entities, including DeFi platforms, miners, and software developers, and requires extensive personal data collection.

Critics argue that the bill is more likely to benefit traditional financial institutions and could result in increased criminal activity by driving the industry underground. Alternative approaches, such as focusing on fiat-crypto exchange points or adopting risk-based reporting thresholds, could better address money laundering concerns without stifling innovation.

Shapella Upgrade to Enable Staked ETH Withdrawals

Ethereum developers announced that withdrawals of staked ETH will be enabled on April 12, 2023, following the successful deployment of the Shapella upgrade. Shapella combines changes to the Ethereum Virtual Machine (EVM) and consensus layer, including enabling staked ETH withdrawals and implementing several Ethereum Improvement Proposals (EIPs).

Despite this milestone, Ethereum's transaction capacity remains low, with danksharding upgrades still several years away. In the short to medium term, rollups are expected to improve transaction speeds. Zero-knowledge rollups, such as MetaMask's Linea testnet and Polygon's scaling solution, are gaining popularity for their ability to enhance transaction throughput without rewriting smart contracts.

Read the first part: Russians using Tether to move money to the West. wpNex enables crypto trading access | FXMAG.COM