This was not the attraction offered companies getting into cryptocurrency, but it appears cryptocurrency business Shapeshift is still one of many blighted by over-regulation within the industry.
The company, claiming to be one of the oldest cryptocurrency exchanges in the business, was represented at the Consensus Conference in New York last week, with its founder explaining just how significantly it was hit last year with numerous requests from the US Department of Homeland Security and the Securities and Exchange Commission.
The Swiss-based operator was hit with 60 such law enforcement requests in 2018 and further claims that the company was “gutted” by legal fees associated with running the exchange, according to Shapeshift CEO and founder Erik Voorhees, adding:
“We’ve spent millions of dollars on legal fees and trying to navigate this stuff and that continues. There is no resolution to the legal grey area and we’re an international company. Every country is a little different, most countries have multiple regulators, none of the regulators really know how to treat this stuff and this stuff keeps changing.”
However, it appears that Shapeshift after “periods of wild profitability” according to Voorhees, have completed significant reconstruction after a Wall Street Journal claim last year that the company had laundered $9m-worth of cryptocurrency. When questioned if these changes were a result of regulatory pressure Voorhees was not prepared to comment, although he did hint that the rebuild wasn’t voluntary, which amounts to the same thing.
In September last year, Shapeshift took the risk of diminishing its popular user base when it announced new NYC guidelines after launching a membership program, effectively putting an end to anonymous trading.
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