The collapse of cryptocurrency exchange FTX and other recent turmoil in crypto markets demonstrate the need for players in the crypto industry to be regulated like banks, ABA President and CEO Rob Nichols and Better Markets CEO Dennis Kelleher said in a new op-ed for CNBC.
Better Markets is an advocacy group that is often on the opposite side of ABA on policy issues. “But today, as the warning lights blink on the economic dashboard and we confront both persistent inflation and the risk of a recession in the months ahead, we both agree that crypto companies and other nonbanks pose a significant and increasing risk to our financial system that needs to be better understood and regulated,” Nichols and Kelleher said.
“The critical overriding principle to getting the shadow banking system on safer ground is this: apply the same regulatory standards to the same products and services, regardless of origin or the technology involved,” they said.
Americans should know that when they engage in any financial activity, they have the same fundamental consumer, investor and financial stability protections in place, Nichols and Kelleher said. “Innovation in the financial sector is critical to maximizing benefits for consumers, and fair, properly and consistently regulated competition can drive this process forward. But consumers also expect that the rules that govern providers—whether bank or nonbank—protect them and financial stability.”