White House: Recent Crypto Crash ‘Further Underscores’ Need for Prudent Regulation of Digital Asset Space

The White House is weighing in on the recent crypto meltdown with pro-regulatory comments in a recent press briefing.

On Thursday, White House press secretary Karine Jean-Pierre responded to questions about US President Joe Biden’s administration’s approach to the crypto sector amid FTX’s high-profile collapse this week.

“I’m not able to comment on what specific actions independent regulators should or should not take on this particular issue, but what I can say is, the administration is aware of the recent developments on this and we’ll just continue to monitor the situation…

The administration has… consistently maintained that without proper oversight, cryptocurrencies risk harming everyday Americans, so this is something that clearly we monitor and that we see as an important issue. But the most recent news further underscores these concerns and highlights why prudent regulation of cryptocurrencies is indeed needed. The White House along with the relevant agencies will, again, closely monitor the situation as it develops.”

Gary Gensler, chair of the Securities and Exchange Commission (SEC), told CNBC on Thursday that the crypto industry is largely non-compliant with existing regulations.

“This is a very interconnected world in crypto with a few concentrated players in the middle and one of those concentrated players would have the toxic combinations of lack of disclosure, customer money, a lot of leverage, meaning borrowing, and then trying to invest with that. And then when markets turned on him, it appears that a lot of customers lost money and that’s where our mission is, it’s about those customers.”

Bloomberg News previously reported the SEC had begun “months ago” investigating FTX’s US arm, FTX US.

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