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- FSOC believes cryptocurrencies may be threatening for the US economy.
- The council was created following The Great Recession of 2007-2009.
- Crypto sector has a total market cap of 956.4 Billion USD at the time of publication.
Another Regulator Sniping Crypto Market
Cryptocurrency sector remains the favorite target for the financial regulators since its inception. The Securities and Exchange Commission, the US monetary watchdog, labeled the digital assets space as “Wild West.” Recently, the Financial Stability Oversight Council (FSOC) said that virtual assets pose a threat to the United States economy according to a CNBC report.
The warning was a part of the 1st major public report by the country’s stability regulator. They believe that stablecoins and lending and borrowing on the crypto platforms are “emerging vulnerabilities” to the economy. Though the sector has provided the investors with some mouth watering profits, crypto winter has affected a lot of people in the community.
The market climbed to the top during November 2021 surpassing 3 Trillion USD market cap. FSOC thinks that the digital asset market can hurt the people in the long run following its rising popularity and potential criminal use. The Treasury Department issued a warning against Russia that the nation may use crypto to evade sanctions following the war in Ukraine.
The FSOC was created following The Great Recession of 2007-2009. The regulator constantly monitors the markets to identify potential threats to the US economy. It organizes a coordinated response with the country’s financial regulators to eliminate any risk bearing elements.
The Great Recession followed a chain of events which cost many people their jobs, homes and savings. It all started with housing prices falling in 2006 followed by subprime lenders filing for bankruptcy and the fall of a couple of hedge funds in 2007. Major shock came with the fall of Lehman Brothers, once a leading global financial company in the USA.
The financial regulators will keep crypto assets under the crosshair for as long as it acts as a threat to the economy. They just want to make sure the citizens and the economy are financially immune to the perils of the market.
Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.
