WASHINGTON, Nov 16 (Reuters) – U.S. Treasury Secretary Janet Yellen said on Wednesday that crypto markets needed stronger oversight, days after cryptocurrency exchange FTX collapsed. .
“The recent failure of a major cryptocurrency exchange and the resulting unfortunate impact on holders and investors of crypto assets demonstrates the need for more effective oversight of the cryptocurrency markets,” Yellen said in a statement, without directly naming FTX.
The Treasury and other regulators had identified risks in crypto markets over the past year, including “the mixing of client assets, lack of transparency, and conflicts of interest,” which were “at center of the crypto market tensions seen over the past week,” Yellen said.
Consumer protections must be rigorously enforced in crypto markets, and the federal government and Congress must act quickly to close any regulatory loopholes, Yellen said.
While the damage was mostly contained within the crypto markets, its ties to the traditional financial system “could raise broader financial stability concerns,” she said.
His remarks largely echo concerns expressed by banking regulators in two days of congressional hearings, in which they said the fallout was limited by the collapse of FTX and other market upheavals. cryptography this year.
Reporting by Katharine Jackson and Ismail Shakil and Lananh Nguyen; Editing by Caitlin Webber and Deepa Babington
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