2018 will be a rocky year for Crypto Exchanges in America due to the SEC cracking down.
This is a serious blow to the Crypto space as this will affect the following:-
This applies to all ICOs currently listing their tokens on American exchanges and this can be a real bummer. As the SEC breathes down on ICOs which are security type tokens, they will have to delist and list them elsewhere.
Everyone and anyone who trades on an American exchange will be AML vetted by having their profiles exposed to the US government. This means you can't use a John Doe avatar to trade, you need to be verified if you are a American citizen or resident. And even then, you will have you trading data exposed and should the SEC deem it fit, your bank accounts can be frozen on suspicions of money laundering.
We all know that you need to move money in and out of exchanges with a KYC verified accounts so if you don't have one yet, your trading volume on a daily basis can be limited by unifying all the trades done in American Crypto Exchanges to just US$20K to US$50K. What's more, American Crypto exchanges offer the best matches for buyers and sellers. So not having access to this volume will ensure that you might not get the best rates for your buy or sell trades on crypto.
Every trade will have to made traceable under the SEC. This also means that when you sell of buy, you will face the wrath of the American government should you not pay taxes like capital gains. Only Non-resident foreigners who trade on American crypto exchanges do not pay any capital gains taxes.
Think for a moment when the SEC finds out that you have multiple exchange accounts in the US and you haven't reported any capital gains during your trades. I hate to think that you will be charged with tax fraud.
By this I mean regulations. It will not be in the same volatility as in 2017 where people made millions base on their holdings of crypto currencies. We are looking at a more subdued market and not one where we see the highs in BTC and ETH.
You must not forget that the main demand for Crypto is by businesses who need them. This includes businesses that cannot open bank accounts like in the case of in the case of the legal cannabis sector but the real demand is from ICOs who use them as currency.
ICOs depend on crypto exchanges to create a vibrant demand for their tokens. If this is going to be under the preview of the SEC, we can be assured that ICOs who do not want to have their bank accounts closed by the American government will have to comply with transparency regulations. And there is no way you can comply if you have structured your token as a security.
This will impact how crypto exchanges will be structured once they legally operate in the US. If an exchange like Coinbase carries on as usual without complying to SEC demands, they will have their bank accounts frozen. They will not be able to remit cash to customers.
This inherently will affect the convertibility of tokens and virtual currencies into fiat currency and when that happens, do you seriously think people will be putting in money in this?
