Abra App to Restrict Services for US Users Over Regulatory Issues
Crypto investment app Abra has been forced to make changes services to U.S. customers over “regulatory uncertainty and restrictions” in the country.
In a blog update on Thursday, the firm said the adjustments come “in an effort to continue to be compliant and cooperative with US regulations as they currently exist”
So what does it mean for affected Abra users? The firm says:
“Specifically, for Abra users in the United States is that we have to make some system modifications around our smart contract based synthetic assets. As a part of this effort we are migrating any synthetic assets to a native hosted wallet solution. On Abra, these are defined as anything other than Bitcoin (BTC), Ether (ETH), Litecoin (LTC) and Bitcoin Cash (BCH).”
The “synthetic asset” is Abra’s way of providing users with exposure to the movements of cryptocurrency prices, without them having to hold the actual crypto. For some cryptos, users can only make deposits into the app via a U.S.-based bank account, an American Express card, bitcoin, bitcoin cash or litecoin. These deposits can then be converted in the synthetic version.
The detail of the changes is as follows:
From Aug. 29, US users will no longer be able to hold Qtum (QTUM), bitcoin gold (BTG), EOS, OmiseGo (OMG), and status (SNT) will have to exchange or withdraw any holdings of those assets from the app by 11:59 p.m. EST (03:50 UTC) on that date.
If any users fail to do so by the deadline, the assets will automatically be converted to bitcoin, the firm says.
Customers in New York state will also be affected, and can only hold native bitcoin, ether, litecoin and bitcoin cash on Abra’s app. All synthetic holdings will need to be exchanged or withdrawn by the same deadline as above, with any remaining synthetic holdings after that date to be converted to bitcoin.
Further, app users in New York will no longer be able to use bank ACH or wire transfers, or American Express cards for deposits and withdrawals after Aug. 29th.
Users outside the U.S. will not be affected by the changes. The private keys for bitcoin, bitcoin cash, litecoin or ethereum held with the firm will continue to be held by U.S. users after the changes, the firm said.
It’s not clear how temporary visitors to the U.S. might be affected. CoinDesk has reached out for comment and will update this article is a reply is received.
Abra image courtesy of the company