- Web3 developers are leaving the US in droves
- The talent drain is a bigger concern for businesses than regulations
- There is a dire need for precise and supportive regulation
In 2022, California and New York had over three thousand Web3-related jobs each. However, what has driven the exodus of developers from these regions over the past five years?
Despite eight of the fifteen largest VC deals in Web3 and crypto startups being secured by US-based firms in 2022, Coinbase’s latest report reveals that more Web3 talent has relocated from the US in the last five years.
The report highlights a significant impact on the number of developers in the US. “The US continues to lose developer share, down 14 points in the past five years; only 26% of crypto developers are US-based today,” it states, emphasizing the urgent need for the nation to take proactive measures to address this trend.
Talent drain and regulatory defects
Coinbase stated that the talent exodus is a significant concern for the country’s top business leaders. For Fortune 500 executives, having access to reliable and skilled talent is now a more pressing issue than regulatory concerns about adopting new technologies.
The unclear and changing US digital asset regulatory landscape creates compliance challenges for Web 3.0 companies. Companies must deal with confusing rules and enforcement without comprehensive legislation.
A new report shows that 50% of US small businesses favor stablecoins because of their stability and lower transaction fees
This has led to conflicts between several Web3 firms and regulatory bodies like the SEC and CFTC. For instance, the SEC has sued Coinbase for allegedly operating an unregistered digital asset exchange and offering unregistered securities, claiming that Coinbase has illegally earned billions of dollars since at least 2019.
The SEC has also sued Binance, alleging that it has operated an unregistered digital asset exchange and has offered unregistered securities. The SEC has accused Binance of mishandling customer funds and failing to register its securities offerings.
Leadership in the digital economy
Coinbase added that clear and supportive regulatory frameworks are essential to retain and attract top talent in the crypto space. Without them, developers will likely seek more favorable environments overseas, preventing the talent drain.
According to Coinbase, the need for US leadership in the cryptocurrency space is clear. Among Fortune 500 executives, interest in collaborating with U.S.-based partners has risen from 73% last year to 79%. This highlights the growing recognition of the importance of domestic collaboration for maintaining a competitive edge globally.
