US Senator Elizabeth Warren calls on the SEC to regulate the crypto sector and defi providers again.
Elizabeth Warren again spoke out in favor of greater regulation of companies in the crypto sector. Warren has been interrogated in Congress about it before. In particular, she warns against decentralized finance (Defi) as the most dangerous part of the entire crypto community.
Elizabeth Warren is a well-known opponent of Bitcoin & Co.
As early as July last year, she wrote to the US Securities and Exchange Commission (SEC). She demands fast and consistent regulation from the authority, since the risks posed by the “highly non-transparent and volatile” cryptocurrencies have to be stopped. Even blockchain fanatics cannot gloss over the constant ups and downs in the price of cryptocurrencies. But at least the transaction history of the blockchain damned by Ms. Warren could not be much more transparent.
Miners should report their energy consumption
Earlier this year, Elizabeth Warren asked US miners to use their energy consumption when calculating the disclose cryptocurrencies. Such demands have never been heard of in other industries in the USA.
Critics rumor that the demanded eco-balance sheet is just a pretext to get their hands on even more arguments against this branch of the economy. More than once, Warren has pointed to bitcoin as the root cause of a lack of consumer protection, terrorist financing, and other abuses.
Defi sector particularly dangerous, according to Warren
Now, Elizabeth Warren voiced her concerns about crypto lending companies. Yahoo! finance Life brought her in front of the camera when several such companies went bankrupt. Warren stressed in an interview last week:
“Congress must act, but the SEC has a responsibility to use its powers to set guard rails and take action against crypto players who break the rules. I’ve been ringing the alarm bells about cryptocurrencies and the need for stricter rules to protect consumers and financial stability. (…)
Too many crypto companies have managed to scam customers and leave ordinary investors out in the cold while insiders make off with their money.”
The conversation started with the insolvency of crypto lender Celsius Network. Previously, the portal had frozen any withdrawals for its customers. A week earlier, competitor Voyager Digital filed for bankruptcy protection (see tweet above). The company cited the difficult situation on the crypto markets and the loan default of the bankrupt crypto hedge fund Three Arrows Capital as the reason for the insolvency.
The Democrat Gary Gensler, the SEC’s chairman, has been repeatedly criticized by Warren for understating the bottom line in terms of regulation. In May, the SEC announced it would nearly double the size of its enforcement division’s crypto unit.
Multiple crypto – Rental companies are insolvent
Democrat Elizabeth Warren is not moving fast enough. In their view, decentralized finance (Defi) is the most dangerous part of the crypto sector. The regulators must take action against stablecoins and Defi platforms, “before it’s too late“, she demands like a mantra in public.