Since the beginning of the year, the market eCrypto Lost about $ 1 trillion, following stock market crashes in the wake of macroeconomic concerns. The sequence of events that led to the sharp upheavals prompted crypto critics and senior regulators to reiterate their concerns about the negative effects of unregulated trading in cryptocurrencies.
Most recently it was the TerraUSD currency, a stable currency designed to be pegged to the dollar, which has fallen in value and now stands at a value of about 8 cents, while completely undermining the market. “The instability of TerraUSD is another reason we must closely regulate stable currencies and other cryptocurrencies,” Senate Banking Committee Chairman Shrod Brown declared in a statement issued by Politico.
In the same committee, U.S. Treasury Secretary and former Fed Chairman Janet Yellen said “digital assets may pose risks to the financial system, and increased and coordinated regulatory attention is needed.” Earlier this month, during a House committee hearing, Yellen called for new federal regulation On cryptocurrencies. “We really need a regulatory framework to protect against the risks,” Yellen said, referring to stable currencies.
The collapse of Hara last week brought another blow to the market, which is not at its best anyway, followed by another new stable currency, the DEI, now showing signs of swaying. “This is a risk that the Securities and Exchange Commission (SEC) chairman Gary Gansler warned of after a panel discussion in the House Appropriations Committee last week. He fears more investors could experience significant losses following a recession in the crypto market if stable currencies continue to falter.” “I think a lot of these currencies will fail,” he told the media last week.
The impact of the digital currency market crash
The SEC chairman is not the only regulator worried that a crypto crash could hit the financial markets as well. “. Bhanam hinted that he intends to step up enforcement in crypto-related cases at the CFTC.
European Central Bank President Christine Lagard, a longtime critic of the market, also referred to the cryptocurrencies in an interview with Dutch television and said: “My very modest assessment is that they are worth nothing, based on nothing, there is no basic asset that will serve as an anchor of safety.” The president of the bank added that she is particularly concerned about people who do not understand the risks involved in volatile digital currencies and may “lose everything”, and therefore the issue should be settled.
For years, regulators and Federal Reserve officials have warned of the risks in the speculative crypto market. St. Louis Federal Reserve President James Bullard told Yahoo Finance a year ago that investors should be “careful” when buying cryptocurrencies because “most of them are worthless.” And even the well-known crypto billionaire, Mike Novogretz, who runs the Galaxy Digital crypto merchant bank, said in an interview with CNN that he thinks most cryptocurrencies will probably fail. “I would bet 75% of the crypto would not succeed,” he said last year.
The founder of Etherium is no longer a billionaire
Whitlick Butrin, who founded the blockchain platform in 2014, has recently seen its ether currency fall 59% since reaching a peak of about $ 4,800 in November 2021. At that time, Butrin’s digital wallet holdings were valued at about $ 1.5 billion. . Today the price of the coin is about $ 1,970.
Butrin tweeted that “in the end you make a mistake in your beliefs, and (especially if you are involved in politics, but also in other areas) correcting the mistake means acknowledging that an earlier version of yourself has brought negative value to the world.” He also discussed the compromises between “openness” and “passion,” and expressed support for the platform he helped create. “Note to the trolls: No, Etherium was not wrong,” he wrote.
Ether is the second largest cryptocurrency by market value after Bitcoin, which has lost about half of its value in the last six months and is now about 60% below a peak of $ 69,000.