ApeCoin Geo-Blocks prevents North American users from staking

ApeCoin Geo-Blocks prevents North American users from staking

North American crypto users will not be able to stake ApeCoin, the ERC-20 metaverse token issued by Yuga Labs, according to a statement from the company on Wednesday.

The ApeCoin DAO claimed that the “current regulatory environment” left it with “no good alternative” but to selectively geo-block the service in many regions, including Canada and the United States.

Yuga bows to regulators

In his last project update, ApeCoin provided details about the upcoming launch of ApeStake.io. The site will go live on September 5, after which the associated smart contract will be funded within two days. Stakers can start accumulating rewards one week after launch on December 12.

However, as detailed at the bottom of the page, staking ApeCoin may prove to be much more difficult for some users than others, depending on their location. Countries and regions including the United States, Canada, Syria, Iran, Cuba, Russia, Crimea, Donetsk and Luhansk will all be geo-blocked.

“We are aware that the geo-blocking of certain users in North America is inconvenient for many members of the Apecoin community,” Yuga said. “Unfortunately, in the current regulatory environment, we had no good alternative.”

Staking in crypto often refers to locking up one’s cryptocurrency to secure a given blockchain network, while being rewarded with network fees and grants. It can also refer to any service that requires someone to lock up their digital coins in exchange for a periodic return.

Such a product puts ApeCoin in the crosshairs of US securities regulators, who have cracked down on crypto lenders providing similar services throughout the year. For example, a California guard dog order Nexo will stop offering interest-bearing crypto accounts in September, considering them unregistered securities.

The Securities and Exchange Commission (SEC) thinks much the same thing: it stopped Coinbase from issuing a loan product last year and even suggested that “proof-of-stake”-based cryptocurrencies might look more like securities.

The federal agency started investigating Yuga Labs for potentially violating securities laws last month. He suspects that some NFTs, as well as Apecoin, may resemble stocks or other securities.

A potential escape?

Although ApeCoin may prevent front-end access to its staking site for certain regions, the organization noted that smart contracts are technically available to everyone.

“We want to remind the community that one of the benefits of decentralized finance is that anyone can interact with a smart contract, or develop clients and interfaces that allow users to interact with smart contracts,” said ApeCoin on Twitter on Wednesday.

ApeCoin added that third-party companies have already developed alternative interfaces to interact with the contract, beyond the proprietary site.

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