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FTX Saga: US Lawmakers Push To Finalize Bill Regulating Cryptocurrencies

The drama surrounding FTX, which continues to play out, is evidence that the cryptocurrency sector must quickly adopt some form of governmental regulation.

The market was struck like a bomb when the news of FTX’s failure became public. The calamitous devastation caused by the catastrophe aroused substantial worries among a significant number of politicians in the United States. For them, having laws in place to manage the industry as soon as possible is a need.

The United States of America is the Way Behind.

Other members of the United States Congress, such as Senator Sherrod Brown, Representative Patrick McHenry, and Representative Maxine Waters, had the same viewpoint as the author.

The second “black swan” occurrence, which occurred after the LUNA catastrophe, presented a very pessimistic picture for investors who had assets that were focused on FTX. As those legislators have emphasized, there is an immediate need for unambiguous law enforcement in order to control the market for digital assets.

In response to the many urgent requests, senators who are responsible for crypto oversight have urged that the law should be completed more quickly.

This new piece of legislation, which is going by the name of the Digital Commodities Consumer Protection Act (DCCPA), is going to lay out the guidelines for how the Commodity Futures Trading Commission (CFTC) would supervise and regulate the cryptocurrency market.

Unfortunately, it could go too quickly.

On Friday, Senator Debbie Stabenow said that the federal law was nearing completion, which provides her and her Republican counterpart, Senator John Boozman, in addition to other regulators on the committee with a strong possibility of scheduling a primary vote.

In a statement he released on November 10, Boozman reaffirmed his intention to continue working on the measure. Stabenow and Boozman also called on authorities to use their power and look into cases of fraud in the digital asset industry and bring those responsible to justice.

The most recent and unexpected turn in a narrative that has captivated a lot of people’s interest over the last few days is the fact that Binance will not intervene to rescue FTX from its present crisis. This is a tale that has been capturing a lot of people’s attention over the past few days.

This tale centers on two of the most influential giants in the field of digital money at the present time.

There is a possibility that FTX would go bankrupt in the near future, although this is hardly the worst-case situation. It has been claimed that a number of authorities are conducting an investigation against Sam Bankman-Fried.

According to a report by Bloomberg, the Securities and Exchange Commission (SEC) has been conducting an investigation into FTX for the past few months to determine whether or not the assets listed on FTX.us can be considered securities, as well as its relationships with Bankman-hedge Fried’s fund, Alameda Research.

It’s Possible That SBF Will Be Arrested.

The potential for legal trouble is mounting, and if the SEC concludes that the item in question is in fact a security, FTX will be in breach of the legislation governing US exchanges.

After the shocking failure of the FTX exchange, a number of cryptocurrency exchanges are getting ready to provide proof of the transparency of their assets. Because of this unanticipated drop, both the future of the world’s second-largest cryptocurrency exchange and the customers of that exchange are in peril.

The Chief Executive Officer of Binance, Changpeng Zhao (CZ), has asked other cryptocurrency exchanges to demonstrate that they properly handle consumer deposits.

In response to the claims made by CZ, Ben Zhou, CEO of Bybit, the third most popular cryptocurrency exchange in the world, affirmed that evidence of the openness and transparency of the assets traded on electronic exchanges will be published in the very near future.

There was a mad rush to open the books.

Numerous major cryptocurrency exchanges, such as OKX, Huobi, and Kucoin, are going to follow suit, saying in separate announcements that they want to make the wallets that contain client funds public and transparent. This will be done in order to comply with regulatory requirements. It is believed that this is an effort to avoid FTX’s mistakes by not following in their footsteps.

According to statements made by Ben Zhou, the current volatility seen in the crypto market serves as a wake-up call for the whole sector. Conversations regarding the significance of maintaining the trust of users have been sparked as a result of this event. Always putting the customer’s trust first should be your number one priority in every transaction.

Investors want a financial system that is entirely decentralized, but a competent regulatory structure comes at the risk of there being no rescue available if unanticipated mayhem breaks out.

The so-called “Wild West” of cryptocurrencies is probably not a place where consumer safeguards should be compromised. There are a lot of hurdles that need to be cleared before rules can be implemented, despite the fact that they are required on some level.

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