The New York-based Nasdaq stock exchange has decided to postpone the launch of its cryptocurrency custody service, citing an uncertain regulatory environment in the United States.
Nasdaq CEO Adena Friedman at the company’s quarterly report financial statement On July 19, 2023, it said:
“Given the changing business and regulatory environment in the United States, we have made the decision to discontinue the launch of our digital asset custodian business in the United States.”
Friedman said the exchange will continue to focus on the digital asset industry, but will not pursue related operating licenses until more clarity is provided. He added that Nasdaq will continue to develop solutions for the industry for the time being.
Friedman also clarified that the decision to delay the launch of custody services is unrelated to the ongoing process of the exchange-backed Spot Bitcoin ETF.
“We are committed to digital investment in a number of ways through our ongoing engagement with regulators, offering comprehensive technology solutions across the trading lifecycle, and partnerships with potential ETF issuers to support tradable exchanges. We remain committed to supporting the evolution of the asset ecosystem’ listed products. ”
Nasdaq is active as a partner in BlackRock’s Spot Bitcoin ETF.
Changing regulatory environment
The exchange first announced plans for its digital asset custody business in November 2022, and the service was scheduled to launch by the end of the second quarter, but the decision was made to delay the launch in March 2023.
But in the weeks since, the regulatory landscape in the U.S. has deteriorated and the response has become more complicated as the SEC stepped up enforcement against the cryptocurrency industry with legal claims against Coinbase and Binance.US.
The SEC has adopted a strong position that most cryptocurrencies are securities and uses this as a key pillar of its execution strategy. However, the issue has yet to be finally decided by lawmakers, and it is a central issue in many of the lawsuits against cryptocurrency companies.
Many cryptocurrency companies have decided to focus on growing outside the United States until lawmakers and regulators can establish certainty for the industry.
Meanwhile, there is some optimism in the industry as the U.S. Congress is set to vote on cryptocurrency bills this week. This outcome could be an important step in clarifying the regulatory landscape of the industry.
An article about Nasdaq delaying crypto custody plans due to “changing business and regulatory environment” first appeared on CryptoSlate.