All analysts agree on one point: the collapse of FTX is a testament to the volatility of the crypto market. Since the fall of Sam Bankman-Fried’s empire, opinions have swirled about the community. Of course, this case also challenged the authorities as well as the crypto regulators. For his part, the Deputy Governor of the Bank of England issued an unfavorable opinion. According to him, crypto is too dangerous.
Crypto regulation is more than crucial
Bank of England Deputy Governor Sir Jon Cunliffe speaks for the first time ever after the arrest of Sam Bankman-Fried. During an exclusive interview with Sky News, he said crypto is “too dangerous”. According to him, strict regulation is paramount (even crucial) without which crypto trading could become a systemic problem. But not only ! A clear regulatory framework is also essential to protect investors and, more importantly, the UK financial system.
During its intervention, Sir Jon Cunliffe refers to regulation that would first target retail crypto investors. Also, it will be necessary to provide a legal framework to protect the financial system from possible problems. Of course, it refers to the latest crypto events (including the collapse of FTX and the arrest of its founder, Sam Bankman-Fried).
The echo of the FTX affair in the United Kingdom
According to statistics, the victims of FTX’s downfall number in the thousands in the UK. More exactly, we are talking about 80,000 customers with each of the individual managers valued at millions of pounds. Most have started a class action lawsuit and proceedings are ongoing.
We do know, however, that Sam Bankman-Fried was extradited to the United States on December 21. He will have to appear in court in New York on several counts of fraud and embezzlement. Added to this are charges of money laundering and campaign finance.
Even if the fallout from the FTX affair gradually dissipates, the community will no longer perceive crypto in the same way. And even less regulators and banks. Certainly, cryptocurrency has proven advantages. But it will have to be subject toa strict and clear regulatory framework to ensure everyone’s safety. Everyone agrees on this point!
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