U.S. Senator Elizabeth Warren says the implosion of crypto exchange FTX shows that the crypto industry needs “more aggressive enforcement.” She stressed: “I’m going to keep pushing SEC to enforce the law to protect consumers and financial stability.” However, many people pointed out that the Securities and Exchange Commission (SEC) has failed to provide clear crypto regulation, leading to U.S. investors using offshore exchanges like FTX.
Senator Elizabeth Warren Wants Tougher Crypto Regulation
Following the crisis at cryptocurrency exchange FTX, U.S. Senator Elizabeth Warren (D-MA) stressed that the crypto industry needs more aggressive regulation. She tweeted Wednesday:
The collapse of one of the largest crypto platforms shows how much of the industry appears to be smoke and mirrors. We need more aggressive enforcement and I’m going to keep pushing SEC to enforce the law to protect consumers and financial stability.
Many people on Twitter disagreed with the senator from Massachusetts. The CEO of the Nasdaq-listed cryptocurrency exchange Coinbase, Brian Armstrong, replied to Warren:
FTX.com was an offshore exchange not regulated by the SEC. The problem is that the SEC failed to create regulatory clarity here in the U.S., so many American investors (and 95% of trading activity) went offshore. Punishing U.S. companies for this makes no sense.
Several other Coinbase executives concurred with Armstrong. Coinbase’s chief policy officer, Faryar Shirzad, tweeted: “Attacking American companies because of the failures of those offshore makes little sense. Enforcement is important, but we need to start with clear rules. That’s good for markets and for investors.” Coinbase’s chief legal officer, Paul Grewal, opined: “These are Americans. They are left exposed on unregulated offshore exchanges. Shouldn’t they be our government’s priority?”
Veteran trader Peter Brandt told Warren that the SEC has failed U.S. investors, tweeting:
Senator Warren, the SEC has completely failed U.S. investors, not the source of regulatory clarity. Your quick-draw bullets hit the wrong entities.
Circle CEO Jeremy Allaire also agreed with Armstrong, stating: “I am with Brian on this. The lack of a clear and sound regulatory framework for U.S. crypto markets has left people exposed to the supervisory powers of the Bahamas and who knows where for others. Please Senator Warren help write sound policy, don’t punt this merely to enforcement.”