Ark Invest Analyst: U.S. May Lose Leadership in Global Crypto Ecosystem

Ark Invest analyst Yassine Elmandjra wrote in a report Monday that the United States is likely to lose its leadership in the global crypto ecosystem to countries such as the United Arab Emirates, South Korea, Australia and Switzerland. 

The report notes that cryptocurrency liquidity in the U.S. has declined significantly, and "the U.S. cryptocurrency ecosystem, once dominated by established and reliable institutions, now faces a void that could put the interest of other institutional investors on hold for the time being. Trading firms Jane Street and Jump Trading, for example, have reduced their participation in the U.S. domestic market.

According to CoinMetrics, U.S. bitcoin trading volume has fallen 75 percent from $20 billion a day in March to about $4 billion last week. US last week, suggesting weaker price discovery in the U.S. The price of bitcoin was $600 higher than on other trading platforms. The report also notes that regulatory uncertainty in the U.S. appears to be holding back existing companies and new entrants in the crypto space.