Investors are increasingly focusing on micro developments and losing sight of the big picture, which is not beneficial for them. For example, Biden’s anti-crypto statements are causing market sell-offs. On the contrary, the court’s decision in favor of XRP Coin is increasing risk appetite.
Corporate Investment in Cryptocurrency
According to a recent report, despite facing regulatory scrutiny in the United States, crypto companies continue to attract investment. A report published by Galaxy Digital on July 14 states that US-based crypto start-ups have a significant share of interest from venture capital firms.
“US-based crypto ventures accounted for over 43% of all completed deals and raised over 45% of the capital invested by VC firms.”
However, it was noted that the total amount of capital invested in crypto and blockchain ventures continues to decline quarter after quarter.
“Only $720 million was raised by 10 new crypto VC funds in the second quarter of 2023.”
According to the report, this figure is the lowest since the beginning of the COVID-19 pandemic in the third quarter of 2020.
The US and Cryptocurrencies
Despite the Securities and Exchange Commission taking action against a number of US crypto companies, the fact that demand in the region remains alive, albeit weakened, is an important signal. Moreover, the lawsuit filed against Ripple, claiming that XRP is a security, partially resulted in favor of Ripple on July 13, stating that it is not a security for retail sales. Therefore, the statements of regulatory agencies, especially the approaches of the Democrats, do not represent a definitive stance for the US as a whole.
The defiance of crypto companies in the region against regulators, the SEC‘s mistake of opposing the entire crypto market, and the court’s decision in favor of XRP. When we consider all of these, we see that the regulatory pressure that is undermining innovation cannot be sustained indefinitely. Many US politicians who agree that innovation is being hindered are now voicing their opinions louder that the current administration is acting against America’s interests.
In conclusion, each passing day seems to be working in favor of crypto investors, at least for now. At the end of the day, the US may have to adopt a more embracing approach to cryptocurrencies (through the courts, through opposition). This could pave the way for institutional demand in the next bull season.
