The response of United States (US) regulators to the crypto industry risks hurting developing companies, according to Chief Technology Officer, Ripple Labs, David Schwartz.
According to Schwartz, many crypto blockchain companies are dealing with regulations that hinder them when they want to start a business or move from foreign markets to the US, according to Cointelegraph.
"It's very difficult to know which laws apply and how they apply them to something new. Generally, that doesn't exist in other countries," he said.
Therefore, the US is one country that is at risk for crypto industry business players; see overlapping rules in the country, according to Schwartz.
He said, "You could have been in business for 5 years publicly, then the regulator said what you were doing was illegal."
Schwartz's comments air after Ripple faces legal action from the Securities and Exchange Commission (SEC) which filed a lawsuit in December 2020 over the CEO and co-founder offering unregistered digital assets with their XRP token.
Since the news broke, a number of crypto exchanges have stopped trading XRP and deleted it. The global money transfer service, MoneyGram, even ended its partnership with Ripple.
In response, Ripple claims that XRP is more like Bitcoin (BTC) and Ether (ETH), classified as a commodity.