Blockchain Capital assesses an emerging crypto hub amid the US meltdown

Blockchain Capital, one of the crypto sector’s most active venture investors, is weighing the merits of several en vogue international crypto hubs amid a sector crackdown by US authorities.

Bart Stephens, founder and managing partner of the San Francisco-based company, said in a statement to The Block that it’s “no secret that the current administration has become openly hostile to crypto by letting Elizabeth Warren and Gary Gensler decide what next- next-generation internet and financial technology will be available to Americans.”

“While the US offshores blockchain technology innovation, other jurisdictions such as the UK, UAE and Hong Kong are actively courting US entrepreneurs and venture capital firms such as Blockchain Capital. Crypto is a global industry and is based on the concept of decentralization, so we are exploring decentralization of our financial and human capital , he added.

Migration patterns

The news comes during a period of drastic action by US regulators in the wake of FTX’s collapse late last year.

This year alone, the Securities and Exchange Commission has brought charges against several crypto outfits including Justin Sun and his companies, along with Bittrex and Gemini, and some celebrities for endorsing cryptocurrencies. At the same time, two crypto-friendly banks in the US – Silvergate Bank and Signature Bank – were shut down by regulators, leaving precious few banking options for startups in the area.

Numerous US crypto firms are now considering where to best base their operations, including the likes of Coinbase, the Nasdaq-listed exchange operator. The company has recently secured a license to operate an international exchange from Bermuda, where it plans to offer derivatives trading; has praised the UAE’s approach to governing the crypto sector; and expanded the services it offers in Singapore.

“The message here is that the world kind of moves on with or without the US, and we’re very committed as a global company to continue international expansion,” said Hassan Ahmed, country director for Singapore at Coinbase.

A pro-crypto regime

Blockchain Capital is one of the crypto sector’s most prolific investors. Founded in 2013, it has backed over 160 companies in the area and manages about $2 billion in assets, according to its website. Block Research’s data suggests it is among the sector’s 25 most active venture investors in the past six months with 12 deals.

A spokesperson for the company said that where it ultimately chooses to expand will depend on which jurisdiction has the most pro-crypto regulatory framework. Authorities in both Hong Kong and the UAE have been actively engaged in crafting more welcoming regimes for crypto firms this year.

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