U.S. Crypto Regulation Crisis: Innovation Under Threat
Written by Ohris M. Greyoon, Blockchain & Crypto Expert
- Regulatory Impact: U.S. Representative Warren Davidson warns that current crypto regulations are stifling innovation and driving capital and talent overseas, particularly as restrictions on non-bank entities hinder their ability to offer interest-bearing services.
- Legislative Barriers: Davidson argues that the GENIUS Act centralizes stablecoin issuance within banks, reinforcing traditional finance models and obstructing the development of decentralized protocols, which could diminish the U.S.'s competitive edge in the crypto space.
- Capital Flight: According to the Blockchain Association, venture capital funding for U.S.-based crypto startups fell over 35% in 2024, while jurisdictions like Singapore and the EU attracted more investment, highlighting the direct economic impact of regulatory uncertainty.
- Future Outlook: Although the CLARITY Act aims to protect self-custody practices, Davidson expresses skepticism about its potential to genuinely alter the entrenched account-based regulatory framework, suggesting it may fail to effectively promote the technological revolution of decentralization.
About the author
Ohris M. Greyoon
Ohris M. Greyoon holds a Master’s in Computer Science from MIT and has 10 years of experience in blockchain technology and cryptocurrency markets. A pioneer in decentralized finance (DeFi) analysis, he leads Intellectia’s Crypto News, offering cutting-edge insights into digital assets.
