Senator Elizabeth Warren (D-Mass.) has warned that the ongoing volatility in the cryptocurrency space will persist unless there are tougher regulations in place to protect investors.
What Happened: In an event hosted by the American Economic Liberties Project called “Confronting the Crypto Challenge: Learning From a Meltdown,” Warren said, “for all their talk of innovation and financial inclusion, crypto industry giants — from FTX to Celsius to Voyager — are collapsing under the weight of their own fraud, deceit and gross mismanagement.”
“And when they sink, they take down a lot of honest investors down with them,” she added.
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Warren took a hard stance on crypto fraud in her keynote address on Wednesday, calling on regulators, such as the Securities and Exchange Commission and banking authorities, to take “meaningful consequences” for bad actors, she said.
“Crypto fraud is a big problem, but it is one that we can fix and the solution starts with the SEC,” said Warren in her keynote. “The SEC has a long history of fighting exactly the battles that we now face.”
She emphasized that tougher regulators would give the industry a chance to show that it can innovate without risking the financial security of investors, or being used for money laundering by drug traffickers and terrorists.
“No financial industry should get to write its own playbook, you either comply with the law or you face tough consequences for violating it. Crypto is no different,” she noted.
This comes at a time when Bitcoin BTC/USD is rallying over $23,000, up 40% since last year.
Disclosure: Benzinga CEO Jason Raznick is a member of the unsecured creditor committee in the Voyager Digital bankruptcy case.