News View Non-AMP

FTX-Like Crypto Market Crash Headed Our Way, Warns CFTC Chair

Published by
Qadir AK

In a recent talk at Georgetown University’s Financial Markets Quality Conference 2023, Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam sounded the alarm about ongoing risks in the cryptocurrency market. While acknowledging changes in the market since last year, Behnam warned that the chance of another crisis similar to the FTX collapse remains worryingly high.

Hurdles in Regulation

Behnam pointed out a crucial issue, emphasizing that U.S. regulators, including the CFTC, lack the authority and tools needed to effectively prevent another significant cryptocurrency market collapse. He explained the CFTC’s limited control over markets that handle trading assets like Bitcoin, hindering their ability to closely watch over company registrations and activities in the cryptocurrency sector.

Adding to the regulatory puzzle, Behnam highlighted that only the securities markets fall under the Securities and Exchange Commission’s (SEC) jurisdiction, leaving a substantial gap in overseeing the broader digital asset market.

Another Market Crash Ahead?

Despite the subdued enthusiasm for cryptocurrency investing compared to the period leading up to the FTX collapse, Behnam warned, “We might be in a situation where another FTX-type event occurs.” He stressed that the market environment has significantly changed since last year, but the fundamental regulatory challenges remain unaddressed.

Action is Needed…NOW!

Behnam urgently stressed the need for a clear and effective regulatory framework for digital currencies. Reiterating concerns voiced at a Senate Banking hearing, he emphasized the CFTC’s limited capacity to fully regulate the digital commodity market. Without legislative empowerment, regulatory bodies are limited in their ability to proactively manage cryptocurrency market risks.

The CFTC Chair’s remarks highlight a critical challenge for legislators and regulators—finding the right balance between safeguarding investors and market integrity while fostering innovation in the fast-evolving digital currency space.

Behnam contends that achieving this balance is crucial for the future stability and growth of the cryptocurrency market, urging a swift resolution to the regulatory challenges.

Read More: Congress and SEC Clash Over Crypto Regulations; Chair Gensler Grilled

Qadir AK

Qadir Ak is the founder of Coinpedia. He has over a decade of experience writing about technology and has been covering the blockchain and cryptocurrency space since 2010. He has also interviewed a few prominent experts within the cryptocurrency space.

Recent Posts

Sui (SUI) Price Analysis Today: Key Targets to Consider Ahead

The Sui network has attracted significant investment from institutional investors seeking to capitalize on its…

April 25, 2025

Dogecoin Price Analysis: Momentum Favors Further Gains

Technical analysis shows that the Dogecoin price is poised to gain 33% to 23 cents…

April 25, 2025

Helium Network Announces Strategic Partnership With AT&T: What Next for $HNT Price?

The AT&T subscribers can connect to Helium’s community-built Wi-Fi network. The Helium network has grown…

April 25, 2025

Ethereum Price Prediction 2025: ETH Price May Trigger a 10x Rally, if This Trade Setup Plays Out Well

The crypto markets are experiencing a powerful bullish wave, highlighted by Bitcoin’s breakout and a…

April 25, 2025

What’s Next for the Chainlink (LINK) Price-Will it Reclaim $20 Before the End of the Month?

The recent rise in the bullish momentum has elevated the markets above the bearish captivity…

April 25, 2025

Coinbase Inks Strategic Partnership With PayPal to Enable Mainstream Adoption of PYUSD Stablecoin

The PayPal USD (PYUSD) stablecoin is fast approaching the $1 billion market cap milestone. The…

April 24, 2025