Poloniex draws criticism after geo-fencing of nine cryptocurrencies

Poloniex, the United States-based digital currency exchange, was in the news recently for disabling the trading services of nine crypto-assets. Following the delisting, Jeremy Allaire, the CEO of Circle, a leading payment platform which acquired Poloniex, criticized the lack of legal clarity with respect to cryptocurrencies in the US.

Gus Coldebella, the Chief Legal Officer of Circle, had previously tweeted that every legal team trying to protect US crypto firms were struggling to make “sound decisions” in light of the latest SEC guidance. He also clarified that geo-fencing assets in the country was their way of responding to the country’s uncertain regulatory scenario.

Frances Coppola, a senior contributor at Forbes, took a jibe at the official and responded,

“Oh look, chief legal officer of a crypto exchange wants new laws so crypto assets aren’t subject to the same restrictions as securities. Because of course the reasons why people need protection from fraudulent securities offerings don’t ever apply to crypto assets, do they?”

The Chief Legal Officer of the firm had previously emphasized the need for a change in the United States’ crypto policies and a proper framework that would provide crypto-businesses and users with legal clarity and certainty. He had revealed that Circle was “actively advocating” an approach to determine the nature of digital assets, within the boundaries of existing regulations.

Terming the laws as being inadequate to address the issues around crypto-assets, Coldebella stated that the SEC guidance wasn’t easy to interpret as digital assets did not qualify within the established categories. He further added that the guidance was tough to apply and rely on, and stated,

“Without congressional action, the SEC is forced to rely on 85-year-old laws and 73-year-old court cases to develop guidance about which digital assets might be considered securities.”

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