Davos: Crypto industry leaders blast Sam Bankman-Fried and FTX as they reject regulators’ latest push for stricter rules

Crypto industry representatives are using the World Economic Forum in Davos to plead the case for decentralised currencies.

Last year’s event took place in early May 2022, before the collapse of LUNA or the scandal surrounding FTX.

And with the fallout of Sam Bankman-Fried‘s business decisions continuing to dominate headlines in the mainstream financial news, advocates of crypto are eager to make the defence for the industry.

Following FTX’s bankruptcy, politicians have once again started talking about the need to regulate the crypto sphere.

So, with 2,700 world leaders and their staff in attendance at the World Economic Forum, Davos was the perfect setting to combat the narrative that has started to form around crypto in recent months.

Speaking on a panel today, Rene Reinsberg, co-founder of the blockchain firm Celo, said that with FTX it’s “important to distinguish this, it’s a failure of institutions, it’s a failure of individuals” with the technology behind it.

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Taking a similar stance, Brad Garlinghouse, CEO of Ripple, said the collapse of FTX should not be painted as “a crypto problem”.

“I think if you really peel enough onion layers, it’s not really a crypto,” he said.

“It’s fraud. And I think we should not pretend it’s something else.”

But despite the arguments made, economic regulators in attendance at Davos have renewed demands for greater control on crypto.

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François Villeroy de Galhau, governor at the Bank of France, said regulation was of the “utmost priority”.

“We have to regulate. We cannot say look there was this cryptocurrency winter and now it’s over,” he said.

“We have to regulate in a coordinated manner. We have to have international rules.”

The chairman of investment bank UBS, Colm Kelleher, added that his firm was eager for a “regulatory framework” to be imposed on the sector.

However, Tharman Shanmugaratnam, chairman of the Monetary Authority of Singapore, claimed that cryptocurrency was “crazy” and that it would be wrong to legitimise the virtual coins through the introduction of regulation.

He said: “If you have to think about regulating cryptocurrency, the same way we regulate banks, insurance companies for prudential reasons, for financial stability reasons, I think we have to take a step back and ask the basic philosophical question: does that legitimise something that is inherently purely speculative and, in fact, slightly crazy?

“Or are we better off providing ultra clarity to what’s an unregulated market and if you go in, you go in with your own risk?

“I lean more to the latter view.”

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