Senate Banking Committee Chair Sherrod Brown said that the collapse of Bloomberg FTX should be a wakeup call for Congress to address the risks posed by the largely unregulated industry.
The Ohio Democrat said that he and colleagues are working with federal agencies to get new regulations in place and to crack down on criptocurrencies. Brown said on Sunday on CNN's State of the Union that it is not like we snap our fingers and get a bill through the Senate and through the House. Half of the Senate, the Republicans and a handful of Democrats still think that cryptocurrencies are legitimate and should be a big part of our economy. The collapse of Sam Bankman- Fried's FTX trading empire has put more pressure on Congress to establish guardrails for the industry, and US financial watchdogs are pressing for more oversight.
Chairman of the Commodity Futures Trading Commission, Rostin Behnam, testified last week at the first congressional oversight hearing on FTX's demise, where he pushed to make his agency the main Bitcoin regulator and give oversight of the exchanges. The Securities and Exchange Commission maintains that most of its securities are securities that fall under its jurisdiction.
Brown said on Sunday that the regulatory push does not stem from one company, as it has been affected by the fiasco at FTX and the $8 billion hole in its balance sheet. This is all about national security. From Russian oligarchs to North Korean cyber criminals to gun runners to drug traffickers, he said that the thought of using unregulated and unrestricted cyber was something that he said.
Senator Pat Toomey, a top Republican on the Senate Banking Committee, told Bloomberg News last week that he believes there is an opportunity for Congress to pass a narrow digital asset regulation bill by the end of the year.
After months of inaction in Congress, Toomey said he is working with Democrats to get some measures, including a regulatory framework for stable coins, attached to a possible spending deal, which will allow Republicans to have a House majority starting in January.
Top US financial officials, including Yellen and Federal Reserve Chair Jerome Powell, have said that the government doesn't have the ability to regulate cryptocurrencies that aren't covered by securities laws.