From Binance backing out to aid beleaguered exchange FTX to Sam Bankman-Fried initiating proceedings to file FTX, FTX US, and Alameda Research for bankruptcy in the United States, a host of key developments took place last week.
Regulators, on their part, have started investigating the company. As reported recently, more than six government regulatory agencies around the world had made it clear that they were examining FTX incidents, including the US SEC, CFTC, DOJ, California and other US local governments, the Bahamas, and the Japanese Financial Services Agency.
Addressing leaders at the G20 Summit in Bali, Binance founder Changpeng Zhao reiterated the need for new, but stable and transparent regulations for the industry. He said,
“We’re in a new industry, we’ve seen in the past week, things go crazy in the industry. We do need some regulations, we do need to do this properly, we do need to do this in a stable way.”
Consumer protection is the need of the hour
A recent report from The Stratis Times revealed that users from around the world have been smitten by the FTX saga. South Korean users were the most affected, followed by Singaporeans, Germans, Russians, and the Japanese.
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In fact, even institutions seem to be in the same boat. Per a study conducted in May this year, prominent names like Coinbase, Pantera Capital, and Polychain co-invested with Alameda in a host of projects. Consequently, the latest bankruptcy filings do not come as good news for these companies.
In fact, Zhao recently warned the community that the fall of FTX will have “cascading effects,”, especially for those close to the FTX ecosystem. A crisis could be on the horizon according to the Binance CEO, with the falling crypto platform as the first domino.
Talking in Bali, Zhao now emphasized the need for consumer protection. He said,
“I think the industry collectively has a role to protect consumers, to protect everybody. So it’s not just regulators. Regulators have a role but it’s not 100% their responsibility.”