US Regulators React to Silvergate Bank Collapse: Will Crypto Face Stricter Rules?
• US Senators Elizabeth Warren and Sherrod Brown have expressed their concern about the collapse of Silvergate Bank and the potential risk to customers.
• Crypto personalities have rebuked Warren’s comments that the crash was predictable due to risky activities in the crypto industry.
• Senator Brown has indicated that stricter regulatory policies for crypto may be imposed in the near future.
Silvergate Bank Collapse
US regulators have reacted to the recent collapse of Silvergate Bank, which is a major player in the cryptocurrency industry. Two prominent US senators, Elizabeth Warren and Sherrod Brown have expressed their concern about this incident and its potential impacts on customers.
Senator Elizabeth Warren, in her tweet, noted that she had previously warned of the bank’s risky activities and identified severe due diligence failures. She further stated that customers must be made whole and regulators should step up against crypto risk. Her comments were met with opposition from prominent crypto figures who believe her take on cryptocurrencies was inaccurate.
Senator Sherrod Brown, Chairman of the Senate Banking, Housing Urban Affairs Committee also commented on this issue stating that stricter regulatory policies for cryptocurrencies might be imposed in the coming months and years ahead. This could potentially mean more restrictions for digital currencies moving forward.
Opposition To Regulatory Policies
Crypto personalities remain opposed to any additional regulations as they believe it can limit innovation within the industry. They argue that Silvergate Bank’s failure had nothing to do with cryptocurrencies but rather because they held more frictionless reserves than other banks did at the time thus making them vulnerable to market forces beyond their control.
The collapse of Silvergate Bank has raised questions around cryptocurrency regulation as US Senators Warren and Brown both call for tighter rules concerning digital currencies moving forward. However, many within the crypto community remain staunchly opposed to any additional regulations as they believe it will stifle innovation within this space going forward.