Crypto markets crashed again. This time, it’s different.
A major downturn in Bitcoin and Ether prices and the flailing death spiral of a popular stablecoin have erased hundreds of billions of dollars from investor portfolios in less than a week.
As crypto executives and retail investors pick through the wreckage, industry leaders fear that the latest blow-up will provide ample fodder for powerful skeptics like Sen. Elizabeth Warren (D-Mass.) and Securities and Exchange Commission Chair Gary Gensler to crack down on an industry that has presented itself as the future of financial services.
“Crypto haters, anti-crypto regulatory enthusiasts will use this as a marching signal,” said Anthony Scaramucci, a pro-crypto financier best known for his 10 days as former President Donald Trump’s communications director in 2017. “Gary Gensler and Elizabeth Warren are going to use it as totems to block, curtail, slow down the industry – no question that they’re going to do that.”
Crypto lobbyists, executives and prominent investors are warning that this week’s turmoil — which coincided with steep losses in traditional financial markets — will serve as a wake-up call to Congress about the dangers of a largely unregulated digital asset ecosystem. As small investors are wiped out, it could also force a harsh examination of venture capitalists and other financiers behind crypto projects that are now failing.
Read the full article at: https://www.politico.com/news/2022/05/13/crypto-braces-for-washington-scrutiny-amid-meltdown-00032162