Senate Banking Committee Chairman Calls for Coordination with Treasury on Crypto

The committee chairman cited crypto exchange FTX's "alarming fraud", liquidity crunch and bankruptcy as examples of financial risks that the Treasury and regulators should deal with.

Sherrod Brown, chairman of the U.S. Senate Banking Committee, has asked Treasury Secretary Janet Yellen to work with financial regulators and lawmakers on comprehensive crypto legislation "in the wake of the 'FTX implosion'.

In a Nov. 30 letter to Yellen, Brown asked the Treasury Secretary to coordinate with regulators to address crypto based on recommendations from the Financial Stability Oversight Committee, or FSOC. The committee chairman cited crypto exchange FTX's "alarming fraud", liquidity crunch and bankruptcy as examples of financial risks that should not "ripple through to traditional markets and financial institutions". p>

“I ask that you coordinate with other financial regulators to continue work on the recommendations of the FSOC report, including the development of legislation that would create authorities to allow regulators to have visibility into the activities of and overseeing affiliates and subsidiaries of crypto asset entities," Brown said. "As noted in the FSOC report, single regulatory agencies generally do not currently have a complete view of of crypto assets."

He added:

"As the failure of FTX makes clear, given the widespread use by crypto asset entities of proprietary crypto tokens combined with opaque financial arrangements and reliance on valuations and from arbitrary data sources, financial regulatory agencies should continue to find ways to improve entity and crypto asset disclosures, market integrity, and transparency."

In October, the FSOC released a report pursuant to US President Joe Biden's Executive Order on Crypto, aimed at exploring potential regulatory gaps and financial stability...