FTX collapse should provide momentum to regulate crypto
By 
Aaron Nicodemus2022-11-15T21:02:00
The collapse and bankruptcy of digital asset exchange FTX offers stark lessons into why rules that apply to traditional investments—overseen by government regulation—ought to apply to digital investments as well.
As recently as Nov. 6, FTX, founded in 2019 by Sam Bankman-Fried, was one of the world’s largest digital asset exchanges, with $16 billion in assets under its control. By Nov. 11, the company filed for bankruptcy following a week in which investors and customers demanded to cash out their investments and sell their FTX tokens (FTT), all at once.
Even for the cryptocurrency industry, which has become accustomed to wild swings in value, the speed of FTX’s fall was stunning. What happened?
Related articles
-
News BriefSilvergate Bank to pay $63M to Fed, California over BSA/AML deficiencies
Crypto-friendly Silvergate Bank will pay a total of $63 million penalties to California and the Federal Reserve Board to settle charges that its anti-money laundering program failed to properly monitor more than $1 trillion worth of customer transactions.
-
News BriefCFTC commissioner urges crypto gatekeepers ‘step up and call for compliance’
Christy Goldsmith Romero of the Commodity Futures Trading Commission called out gatekeepers—lawyers, accountants, auditors, compliance professionals, and others—for failing customers in the unregulated cryptocurrency market.
-
News BriefSEC charges Genesis, Gemini for failing to register crypto lending product
The Securities and Exchange Commission accused two cryptocurrency firms, Genesis Global Capital and Gemini Trust Company, with selling a crypto lending product to investors as an unregistered security.
More from Opinion
-
OpinionA friend for the compliance officer: Co-thinking with AI
At their core, compliance officers are problem-solvers. They wrestle with thorny questions every day: How do we implement a global gifts-and-entertainment policy across jurisdictions with vastly different cultural norms? How do we balance business pressures with anti-corruption obligations? How do we address new risks like AI itself?
-
OpinionCross-border compliance: Lessons from the UAE for a globalized financial system
Financial ecosystems are no longer confined within national boundaries. Money, technology, and risks flow seamlessly across jurisdictions, creating unprecedented challenges for compliance officers. From sanctions and anti-money laundering (AML) obligations to the rise of virtual assets, the compliance function must now navigate a complex, cross-border landscape where regulators, institutions, and ...
-
OpinionWhy audit won’t save your anti-money laundering (AML) program
In financial institutions across the United States, there’s a reflex that’s become almost ritual. When a regulator walks in, or a board member asks whether the AML program is working, the answer is the same: “We just passed audit.” It’s delivered with confidence, sometimes even pride, as if the risk ...