ACINQ and zkSNACKs, creators of Phoenix Wallet and Wasabi Wallet respectively, are ceasing operations in the US due to regulatory challenges.

US authorities are considering whether to classify Lightning nodes and self-custody wallets as Money Service Businesses, leading to increased legal pressure.

As a result of the regulatory environment, ACINQ has removed Phoenix Wallet from US app stores and zkSNACKs has blocked US IP addresses from accessing their site.

The US has seen legal action against cryptocurrency entities like Consensys and Samourai Wallet's founders, highlighting the strict regulatory stance.

Conversely, European regulations are moving towards a more favorable position for self-custody wallet developers, provided they don't hold user assets.

These contrasting regulatory approaches between the US and Europe could significantly affect the distribution and use of cryptocurrency services in the respective markets.