Coinbase recently released a report expressing concerns about the dwindling pool of crypto talent in the United States. According to the report, there has been a significant decline in the number of US-based crypto developers, dropping by 14 points over the past five years to a mere 26% today. The largest US exchange attributes this decline in talent to the lack of regulatory clarity surrounding the crypto realm, which is pushing developers to seek opportunities outside the country.
Top Fortune 500 executives are also raising concerns about the shortage of trusted talent in the crypto industry. They see this talent scarcity as a greater obstacle to widespread crypto adoption than regulatory issues. However, smaller businesses are showing interest in recruiting crypto-savvy candidates to fill roles in IT, tech, finance, and legal departments. About 68% of small companies believe that blockchain and cryptocurrency can help address major financial pain points such as processing time and transaction fees.
On-Chain Projects and Increase in Web3 Initiatives
Despite the decline in crypto developers, the US is experiencing a surge in on-chain projects. For example, the number of Web3 initiatives by Fortune 100 companies has seen a 39% increase. Additionally, 56% of Fortune 500 executives have revealed that their companies are actively working on on-chain projects, such as consumer-facing payment applications. This uptick in on-chain projects is attributed to the recent approval of a spot Bitcoin ETF, leading to assets under management for spot Bitcoin ETFs surpassing $63 billion.
The Urgent Need for Regulatory Clarity
Coinbase emphasizes the urgent need for clear rules and regulations around crypto to retain developers in the US. The report underscores the importance of clear regulations to keep talent in the country, ensure better access to crypto, and enable US leadership in the global crypto industry. Senator Cynthia Lummis has also voiced concerns about the strict regulatory stance of the Biden administration and Gary Gensler towards Bitcoin and digital assets. She warns that this approach could drive the industry overseas, potentially jeopardizing America’s leadership in financial innovation.
The Coinbase report praises the efforts of payment companies like PayPal and Stripe in making crypto, especially stablecoins, more accessible. Merchants using Stripe can now accept USDC payments, which automatically convert to fiat currency. PayPal also facilitates transaction-free cross-border transfers across 160 countries, a stark contrast to the average charges of 4.45% to 6.39% in the international remittance market. Additionally, 48% of Fortune 500 executives believe that crypto has the potential to enhance access to financial systems, particularly banking for the underbanked and unbanked populations.
The decline in crypto talent in the US highlights the need for regulatory clarity to retain developers in the country and foster innovation in the crypto industry. While there are challenges ahead, it is crucial for the US to take a leadership role in the crypto space to ensure continued growth and accessibility in the financial sector.