© Reuters.
Investing.com – The collapse of the FTX cryptocurrency exchange leaves behind more than one million customers with damage of around $8 billion. This scenario would not have happened if the cryptocurrency industry had been properly regulated.
Fed Vice Chairman Michael Barr has taken the opportunity of recent events to call on Congress to act quickly. He referred to the fact that recent events are the result of the absence of reasonable regulation of emerging asset classes that would allow them to be framed:
“Some financial innovations offer opportunities, but as we have seen recently, many innovations also come with risks. These include run on deposits, collapse of assets, misuse of customers’ money, fraud, theft, manipulation and money laundering.
These risks, if not properly controlled, can harm private investors and run counter to the objectives of a safe and fair financial system.
But recent events remind us of the potential for systemic risks if interdependencies develop between the existing cryptosystem today and the traditional financial system.”
By Marco Oehrl