• US regulators are reacting to the collapse of Silvergate Bank, a crypto-friendly bank.
• Prominent crypto personalities are challenging Senator Elizabeth Warren’s views on digital currencies.
• Senator Sherrod Brown is also not pleased with the events in the cryptocurrency market and hints that regulatory policies might be stricter in the near term.
Silvergate Bank Collapse
The recent collapse of Silvergate bank has caused U.S. regulators to take stock of the state of affairs in the cryptocurrency market. Senator Elizabeth Warren expressed her displeasure with Silvergate’s failure, noting that she had previously warned about its risky activity and identified severe due diligence failures. Other prominent figures in the cryptocurrency industry have pushed back on Warren’s claims, insisting that Silvergate collapsed solely due to their frictionless reserves compared to other banks.
Senator Warren’s Comments
Senator Elizabeth Warren expressed her dismay at Silvergate’s collapse and believes that regulatory bodies should tighten up and contain any dangers posed by cryptocurrencies. She tweeted: “As the bank of choice for crypto, Silvergate Bank’s failure is disappointing, but predictable. I warned of Silvergate’s risky, if not illegal, activity—and identified severe due diligence failures. Now, customers must be made whole & regulators should step up against crypto risk.“ However, some prominent figures from within the cryptocurrency industry have disputed her assessment of digital currencies being dangerous or illegal activities.
Senator Brown’s Comments
Senator Sherrod Brown also commented on how he believes regulatory guidelines need to be tightened for cryptocurrencies in order to protect consumers and prevent further collapses like this one from occurring again in future years ahead. He noted: “Now more than ever it is important for us as policy makers to ensure we are protecting consumers from these risks by putting forward regulations that will provide greater oversight into this burgeoning marketplace” This statement implies that regulations surrounding cryptocurrencies may become stricter over time as lawmakers attempt to protect consumers better by tightening controls around digital assets
Crypto Reactions
Prominent figures within the cryptocurrency Trading community have pushed back against both Senators‘ comments regarding digital currencies being dangerous or illegal activities. Scott Melker argued that Senetor Warren was wrong about why Silvergate collapsed and that it was solely because they had more frictionless reserves than any other bank rather than anything related to crypto trading activities taking place there
Conclusion
It appears that U..S regulators are beginning to take stock of what happened with Silverage Bank’s collapse and its possible consequences for digital currencies going forward in terms of greater regulation or tighter control over trading activities taking place within this space overall