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Phoenix Wallet Exits U.S Market Amid Increasing Regulatory Scrutiny

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Phoenix Wallet Exits U.S Market Amid Increasing Regulatory Scrutiny

  • American users should withdraw their funds from their wallets before May 3, 2024.
  • This move adds weight to discussions concerning the crackdown on crypto companies.

Phoenix Wallet, a non-custodial Bitcoin lightning wallet has announced its intention to remove itself from the Google Play Store and the Apple App Store in response to the increasing governmental pressures in the United States.

American users should withdraw their funds from their wallets before May 3, 2024, when the removal will be implemented. When users are clearing their wallets, Phoenix Wallet advises against “not force-closing” channels because of the potential high on-chain costs. This choice is in response to an earlier X post by ACINQ, the Phoenix Wallet developer, indicating a potential shutdown of the Wallet service.

ACINQ posted on X stated:

“Recent announcements from US authorities cast a doubt on whether self-custodial wallet providers, Lightning service providers, or even Lightning nodes could be considered Money Services Businesses and be regulated as such.”

Increasing Regulatory Scrutiny

It should be noted that this kind of behavior from Phoenix Wallet is quickly gaining popularity in the US, adding weight to discussions concerning the region’s crackdown on crypto companies. The Southern District of New York has arrested Keonne Rodriguez and William Lonergan Hill, who founded the Bitcoin mixing wallet Samourai.

Conspiracy to launder money and running a money-transmitting company without the proper license are among the charges leveled against them. A notice from the FBI apprised crypto users of its “operations” against many unregistered crypto companies thought to be engaged in money services shortly after.

Users were therefore warned of the possibility of “financial disruptions.” Sanctioning Tornado Cash addresses, prosecuting the operator of the Bitcoin Fog mixer, and many more enforcement measures have all been documented by U.S authorities.

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Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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