Financial Regulators Urge Congress to Pass Crypto Legislation in New Report

cryptonews.com:

The Financial Stability Oversight Council (FSOC) has renewed its calls for Congress to pass crypto legislation, according to their annual report released Thursday.

FSOC’s latest release reiterates its suggestion from last year’s report demanding greater regulation of spot markets crypto assets classified as non-securities and greater regulation of stablecoins overall.

The report encapsulates 14 different economic vulnerabilities and “makes recommendations to further enhance the integrity, efficiency, and stability of U.S. financial institutions and markets.”

In regards to crypto, FSOC noted a string of vulnerabilities, including “crypto-asset price volatility, the market’s high use of leverage, the level of interconnectedness within the industry, operational risks, and the risk of runs on crypto-asset platforms and stablecoins.” 

Moreover, FSOC alleges the crypto market is facing a number of potential vulnerabilities, including “token ownership concentration, cybersecurity risks, and the proliferation of platforms acting outside of or out of compliance with applicable laws and regulations.”

The release of FSOC’s report follows a turbulent year for the crypto industry wherein a number of key players faced regulatory consequences.

In November, a jury found FTX founder Sam Bankman-Fried guilty of fraud after an intensive month-long trial where the disgraced “king of crypto” testified on his own behalf.

The same month, Binance founder Changpeng “CZ” Chao was charged with violating federal anti-money laundering regulations, prompting the then-CEO to step down from the company.

Most recently, the IRS has followed with a tax claim against the now bankrupt FTX seeking over $24 billion in restitution, threatening the chance FTX debtors