U.S. Treasury Secretary Janet Yellen also mentioned the impact of FTX events, stating that crypto regulation is needed.
FTX, which is called the second largest cryptocurrency exchange in the world, caused global reactions after its bankruptcy. The collapse of the FTX stock market also affected the global economy. In particular, the assets of investment asset management companies suffered serious losses. With the FTX collapse, most companies took legal action to recover their assets. Scandalous allegations also took place behind the bankruptcy of the stock market. FTX CEO Sam Bankman-Fried allegedly made transactions with client funds. After all these processes, the US Treasury Secretary pointed to the regulations.
US Treasury Secretary Highlights Crypto Industry
US Treasury Secretary Janet Yellen gave an interview to Bloomberg. Yellen addressed the collapse of the FTX empire founded by Sam Bankman-Fried. Drawing attention to the recent collapse, the minister stated that a very careful arrangement should be made. Yellen did not elaborate on crypto regulations.
In addition, Yellen stated that the events highlighted the weak points of the crypto industry. The Minister also said:
The idea that an exchange could use deposits from its clients and lend them to a separate entity to make leveraged, risky investments… This is not allowed.”
In addition, the US Treasury Secretary also referred to the fact that cryptocurrencies are not fully integrated into the banking sector. Yellen noted that the consequences of the FTX debacle could have been more severe if crypto were more integrated into the financial system.
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