German financial watchdogs post FTX collapse crypto industry. A no-interference approach was wrong, agency chiefs said, arguing it was time to protect consumers as the sector expanded its ties to traditional finance.
15} President Bafin is convinced that self-regulation does not work for cryptocurrencies
The man in charge of the German Federal Financial Supervisory Authority (Bafin) demanded regulation. According to Mark Branson, this will increase consumer protection, prevent money laundering and maintain financial stability.
Just after U.S. authorities indicted founder Sam Bankman-Fried, company executives told reporters in Frankfurt on Tuesday that the company’s non-interference “is just growing the industry as a playground for grown-ups.” said the approach was the wrong tactic. Crypto exchange FTX failed due to fraud and other crimes.
“Crypto Winter” may be followed by “Crypto Spring,” but what ultimately emerges is likely to have more ties to the traditional financial system. Branson emphasized that it will be expensive and will require even more regulation. According to Reuters.
Now is the time for serious crypto regulation.
Germany’s top financial regulator said a European solution was not enough, what was needed was a global one. So far, the regulation of cryptocurrencies has been loose and patchy, Bafin officials added.
The European Union is working on a new Crypto Asset Market (MiCA) law, with EU institutions and Member States reaching an agreement on a package in July this year, 2023.
Its main The aim is to establish a harmonized regulatory framework for cryptocurrencies and related activities at Union level. But it will take at least another year to apply that provision across its 27 powerful blocs. Some officials, including European Central Bank President Christine Lagarde, are talking about expanding its scope or even adopting “MiCA 2.”
The report points out that Mr. Branson has historically been skeptical of cryptocurrencies. In an interview published by the eurozone monetary authority in November, the German said, “Not all cryptocurrency business models are serious,” adding, “As we know, a wave of innovation is free. They also bring loaders and crooks,” he added.
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