U.S. Senator questions need for a ban on cryptocurrencies

The cryptocurrency industry needs stricter rules, but there is little point in advocating a blanket ban in this matter, said Tina Smith, a U.S. Senator from Minnesota, on NBC.

Commenting on the collapse of FTX, Smith noted that about 40 million Americans have some investments in digital assets.

“So saying that we are simply going to end this, I don’t quite understand how that would work,” she explained.

Smith, together with Democratic colleagues, led a campaign calling for tougher regulation. When asked whether cryptocurrencies should be treated as a commodity, she cited consumer protection as the real issue and urged the SEC to use its experience.

“We know how to protect consumers in this country from dubious financial deals and from unethical players, such as, apparently, FTX […]. I am not saying that the Commodity Futures Trading Commission [CFTC] does not play an important role. But I think the problem lies in how to ensure that there are basic consumer-protection safeguards so that people are not robbed,” she explained.

In December, the chair of the Senate Banking Committee, Sherrod Brown, suggested that regulators should consider the question of banning cryptocurrencies. He also acknowledged the difficulty of implementing such a scenario.

Earlier, Senators Elizabeth Warren and Roger W. Marshall introduced a bill to tighten anti-money-laundering measures involving cryptocurrencies. The document also calls for expanding the powers of the SEC and CFTC.

In November, Warren called for tighter regulation of cryptocurrencies, drawing parallels between FTX and Lehman Brothers.

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