CFTC Commissioner likens crypto-market contagion risk to 2008 financial crisis

The vulnerabilities observed in the cryptocurrency market are analogous to those characteristic of the global financial crisis, which makes expanding the powers of the CFTC necessary. She said, Commissioner Christi Goldsmith Romero of the agency.

The official pointed to the collapse of the Terra ecosystem and the subsequent ‘contagion’ across the digital asset ecosystem.

According to Goldsmith Romero, the strengthening of ties between crypto markets and traditional markets increases risks to overall financial stability.

“The market for digital assets remains relatively small […]. But in the near future this may cease to be relevant due to growing interest in the space from traditional finance industry participants,” — she explained.

Goldsmith Romero highlighted the need for restrictions on pension funds.

The commissioner indicated a commitment to the approach “the same risk, the same regulatory framework”.

“Similar to post-crisis reforms, Congress can mitigate financial stability risks by granting additional powers to the CFTC,” she suggested.

Earlier in October, Rostin Behnamwarned the crypto industry about the inevitability of regulation. Later, he opposed the confrontation with the SEC on this issue.

The agency initiated 18 enforcement actions against crypto startups, according to the CFTC’s annual report.

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