Bitcoin and cryptocurrency prices rose this week, pushing the consolidated crypto market to its all-time high of around $ 2.5 trillion. The price of bitcoin has halved since its September lows, hitting over $ 60,000 for the first time since May, as the Wall Street giants gradually begin offering bitcoin and currency services. crypto to clients, including a highly anticipated Bitcoin Futures Exchange Traded Fund (ETF).
“You don’t have to occupy most of the financial sector to cause financial stability problems,” John Kanriff said in a speech. “In 2021, it will go from just under $ 800 billion to around 200%. Stressed the crypto market, which today stands at $ 2.3 trillion. “
Earlier this week, influential central banker Jon Cunliff, now vice president of financial stability at the Bank of England, warned that “a significant collapse in crypto asset prices.” The “plausible scenario” and rapidly growing Bitcoin and crypto markets may pose a threat to the financial system, unless they are urgently regulated.
“As the financial crisis has shown us that it is not necessary to occupy most of the financial sector to cause financial stability problems. Subprime mortgages were valued at around $ 1,200 billion in 2008. ”
Cunliffe shows increased risk by expanding crypto services to big banks, expanding crypto hedge funds, and allowing people to settle transactions with stablecoin (a cryptocurrency pegged to traditional currencies). Listed payment companies that are considering doing so.
Having played a central role in cryptocurrency oversight in recent years as an advisor to the G20 Financial Stability Board and the Geneva-based Bank for International Settlements, Cunliffe urgently restricts the boiling market under strict regulation. against regulators. I asked you to do it.
Bitcoin prices have increased dramatically over the past few years, but are still very volatile. In May, after the price of Bitcoin hit nearly $ 65,000 per Bitcoin, the market collapsed and the price of Bitcoin lost almost half of its value within days.
“When something in the financial system is developing very quickly and in a barely regulated space, financial stability authorities have to stand up and be careful,” Cunliffe added. It should be pursued as an urgent matter. “
This week, San Francisco-based Bitcoin and Cryptocurrency Coinbase is a single, dedicated agency that regulates the crypto market, claiming that existing regulators are too fragmented and that U.S. securities law is outdated. I asked for the establishment. Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), has been tasked by lawmakers with addressing concerns in the crypto market.
Coinbase and Binance are currently the world’s largest crypto exchanges with no fixed headquarters, and this year, around the world, Watchdog is working on ways to monitor new digital asset classes that transcend many traditional systems. Confrontation with regulators.
Many Bitcoin and crypto companies are seeking regulatory clarity that they believe will help bring new funding and innovation to the rapidly growing crypto space. “We welcome new regulations in this area to attract more capital and interest,” said Martha Rayes, head of research at Prime Brokerage and Exchange Bequant for digital assets, in an email comment. . It’s already happening. “But it is no exaggeration to say that this sector threatens financial stability.”
Cunliffe is not the first to warn that the very hot Bitcoin and crypto markets could cause a future collapse. Earlier this year, Macquarie CEO Viktor Shvets said: Bulk Podcasts The next financial crisis could be due to crypto enthusiasts.
Summary of the news:
- ‘Urgent’ action needed: ‘massive’ warning of Bitcoin and cryptocurrency price collapse posted on systemic risk
- Check out all the news and articles about the latest security updates.