Crypto trading increasingly resembles the US stock market of the late 1920s, says the head of a Swiss financial watchdog. This senior official believes that regulators around the world should do more to ensure investor protection.
The head of Switzerland’s financial watchdog calls for tighter regulation of “abusive” crypto markets
Governments are still searching for the best approach to oversee the $900 billion crypto asset market, which is only partially regulated in many jurisdictions, Euronews reported Wednesday. Authorities have issued numerous warnings about the risks associated with cryptocurrency investments, including “opaque crypto market manipulation.”
According to a statement by Urban Angehrn, CEO of the Swiss Financial Market Supervisory Authority (Finma), much can be done in that regard. At a conference in the Swiss city of Zurich, Angehrn further commented:
Much of the trading of digital assets is like the U.S. stock market in 1928, and it seems that fraud, pump and dumping of all kinds is indeed frequent today.
The head of Finma also urged his colleagues to “think about the potential of technology to easily process large amounts of data and protect consumers from unfair market transactions.” His call came amid the market turmoil of the past few weeks and problems with several crypto projects.
The overall capitalization of the crypto market has dropped to $900 billion from about $3 trillion in November 2021. Bitcoin (BTC), the cryptocurrency with the largest market capitalization, fell below $20,000 per coin earlier this month for the first time since December 2020.
The loss in value this year has amounted to about 60%, but it has been noted that high inflation and rising interest rates have also prompted a flight of funds from other high-risk assets and stocks. Against this backdrop, regulatory pressure on the industry could increase, given the problems of companies like Celsius.
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