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‘Conglomerate’ Platforms Will be the Focus for 2023 | Global

  • The current market circumstances necessitate the creation of crypto regulations.

  • Crypto conglomerate platforms like FTX create a conflict of interest without regulations.

  • IOSCO plans to release a consultations report on these issues in the first half of 2023.

24-Nov-2022 By: Divya Behl
‘Conglomerate’ Platf

The meltdown of cryptocurrency exchange FTX,

as well as its mismanagement of users' funds, has sparked widespread concern among the crypto community and global regulators.

Several agencies and regulators are calling for strict crypto regulations which not only govern digital assets but also regulate the operations of crypto service providers.

Recently, the new chair of global securities watchdog IOSCO stated in an interview that the regulation of cryptocurrency platforms could borrow concepts from industries that already deal with conflicts of interest, like credit rating companies and those that create market benchmarks, without having to start from scratch.

The watchdog reported that the regulation should be more focused on crypto 'conglomerates' like FTX. This platform performs multiple roles, such as brokerage services, custody, proprietary trading, and token issuance, all under one roof, which creates conflicts of interest. 

Crypto Regulation is the urgent need of an hour

As previously reported by CoinGabbar, market circumstances have resulted in the loss of users' trust. In this case, only strict crypto regulations will help the market to regain its users' trust.

CoinGabbar earlier published an article titled "How Can Crypto Regulations Be The Game Changer?" The article will give you a comprehensive overview of how regulations must be designed and how they became a game changer.

But one thing we won’t add in that article was regulations for crypto conglomerates. This must be addressed in order to ensure the continued safety of users' funds and trust.

As IOSCO highlighted that “We believe the world is changing. We know there is some room for developing new standards for supervising crypto conglomerates. There is an obvious necessity.”

IOSCO also added that “We intend to publish a consultations report on these issues in the first half of 2023.”

What’s next

The collapse of the crypto exchange FTX demonstrates the importance of bringing the crypto world within the regulatory framework. Experts believe that if regulations won't be enacted by governments, we will unquestionably witness another such event in the future.

What do you think will happen if governments around the world won't implement strict crypto regulations to prevent such events? Share your views in the comment section below.

Read also: Binance CEO CZ optimistic about crypto's recovery

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