The $800 billion crypto price shock sparked apocalyptic fears for Bitcoin and Ethereum. According to Nobel Prize-winning economist Paul Krugman, there are strong signs that the crypto industry is sinking into oblivion.
Will Bitcoin and the crypto ecosystem be forgotten?
Bitcoin (BTC) and crypto markets suffered a massive crash following the shocking explosion of FTX. President Joe Biden is leading the calls for game-changing crypto rule changes. The leading crypto Bitcoin price dropped as low as $15,500. Leading altcoin Ethereum price slipped towards $1,000. Now, the total crypto market has dropped below $800 billion for the first time since late 2020. MarketCap was at $3 trillion this time last year.
Nobel Prize-winning economist Paul Krugman warns that Bitcoin and the crypto industry may be ‘on the way to oblivion’. Asking if this is the ‘end’ for crypto, Krugman comments in the New York TimesNYT column:
It is difficult to see what advantage these firms will have over ordinary banks. Even if the value of Bitcoin does not go to zero (which it still is), there is a strong case that the crypto industry, which seemed so great just a few months ago, is sinking into oblivion.
Regulatory calls for the crypto market are getting stronger
After a fight between FTX founder Sam Bankman-Fried and the CEO of rival exchange Binance, FTX collapsed. Rumors that the collapse will put other big companies in a difficult situation have shaken the Bitcoin and crypto industry. As you follow on cryptokoin.com, the sudden collapse of FTX has also sparked calls for regulation to better protect crypto users after FTX and other crypto companies lost access to crypto funds, which had to suspend withdrawals to fend off the storm.
Last week, US President Joe Biden led the G20’s call for stricter global crypto rules. Additionally, US Treasury Secretary Janet Yellen said that the fall of FTX “shows the need for more effective regulation of the cryptocurrency markets.” She stated that the rules in traditional markets should apply to cryptoassets.
Bitcoin price has been in a drastic downtrend this year. Ethereum and other altcoin projects followed suit. However, a brutal stock market crash expanded his business in size. Many in the bitcoin and crypto space are calling for regulatory clarity to better protect customers and eliminate bad actors.
If crypto is to survive, we will need to see an agreed-upon form of regulation coming from within the industry and overseen by regulators such as the U.S. Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC). Anna Becker, CEO of Bitcoin and crypto trading platform EndoTech, points out the following:
It is necessary to ensure that the proposed standards are established. Tight regulation is an urgent matter. It needs to be created immediately. Individual investors who are not as risk-aware as professional investment firms deserve reliable oversight, guidance and risk disclosure.
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