In the wake of the FTX crash, Germany’s financial authority has called for international regulation of the cryptocurrency business.
The agency’s chief insists that the hands-off strategy was incorrect and that it is now time to protect consumers as the industry deepens its ties to conventional finance.
The man at the helm of the Federal Financial Supervisory Authority of Germany (Bafin) has advocated for global regulation of the cryptocurrency market.
Shortly after U.S. authorities accused Sam Bankman-Fried, founder of collapsed crypto exchange FTX, with fraud and other offenses, the executive told reporters in Frankfurt that taking a hands-off policy that would “simply let the market flourish as a playground for grownups” was the wrong strategy.
According to Reuters, a “crypto spring” may follow what has been a “crypto winter,” but whatever emerges in the end is likely to have stronger ties to the conventional financial system, further highlighting the need for regulation.
A global solution is required, according to Germany’s top financial regulator, who went on to explain that a European solution would not be adequate on its own.
According to the Bafin official, crypto regulation has been patchy and loose up to this point.
A deal was reached between EU institutions and member states on the Markets in Crypto Assets (MiCA) legislation package in July of this year, and it is anticipated to go into effect in 2023. The European Union has been working on this legislation.