Bancor To Restrict US Cryptocurrency Traders Citing Lack Of Clarity From Regulators

Citing lack of clarity from regulators, Bancor, a decentralized exchange platform will be restricting US traders. The decision comes at a time when there is an uncertainty surrounding cryptocurrency.

Through an official blog post, Bancor informed its users that US citizens, domiciliaries or users from US IPs will no longer be able to use the company’s web application to convert tokens. It says that users with Bancor wallet will still be able to log-in, hold tokens and transfer tokens from the United States. However, the convert functionality will be disabled.

“This decision has been made in light of increased regulatory uncertainty; at this time, we believe this is the most judicious decision for all the members of our ecosystem. This will enable the Bancor community and ecosystem to innovate faster and with greater clarity,” the platform explained.

Coin Greek said Bancor’s decision follows uncertainty around the legal status of decentralized exchanges in the United States.

In November 2018, Zachary Coburn, the founder of Etherdelta was charged with operating an unregistered exchange by the US Securities and Exchange Commission (SEC). However, the Electronic Frontier Foundation (EFF) told the SEC that writing and publishing code is a form of ‘protected speech’ under the First Amendment. It said courts don’t take kindly to government agencies requiring people to obtain licenses before exercising their free speech rights. The EFF also called on cryptocurrency exchanges to adopt best practices around defending user rights, inclusive of issuing regular transparency reports.

Siding with decentralized exchanges, EFF said the platforms are in their earliest stage of development. “They aren’t widely used right now, but this is an area of rapid research and innovation.” It explained that cryptographers and programmers are experimenting with smart contract systems to develop new systems to help users correct the power imbalances when they engage in online transactions.