By
Godfrey Benjamin
May 10th, 2024
Bankman-Fried also addressed the need for better crypto education so that people can make informed choices.
FTX founder and CEO Sam Bankman-Fried has called for better regulation and crypto education for American citizens. He stated this during an interview with the Economic Club of New York on Thursday.
The young billionaire believes the US needs to take a clear stance on its position regarding cryptocurrency regulations. This is necessary given the continued involvement of its citizens both in mining and holding cryptocurrencies. Recall that the US became the world’s Bitcoin mining headquarters with 35.4% of the global BTC hash rate. Many are also keen on investing in cryptocurrencies.
Bankman-Fried understands the risks associated with cryptocurrency and the difficulty of the legislation in the sector. He believes that proper oversight was necessary but lacking. Likewise, he noted that the best line of action is for the US government to provide safety nets against risky investment and financial crimes. He also argued that establishing basic regulatory plans was a good place to begin even if the law was still far out.
Crypto Education Is Also Important
Bankman-Fried also addressed the need for better crypto education so that people can make informed choices. With mainstream adoption growing and the number of cryptocurrency projects increasing daily, the need for this cannot be overemphasized.
Senior managing director of compliance at security firm Guidepost Solutions, Eric Young, agreed to the assertion. On her part, Tally Greenberg, head of business development at staking provider Allnodes talked about the need to harmonize information about crypto assets.
She noted discrepancies in the IRS’ definitions of cryptocurrencies as taxable property while the Financial Crimes Enforcement Network, on the other hand, calls them a currency substitute.
“Without proper definitions, a smart contract written in code may or may not be enforceable,” Greenberg said.
The FTX Boom
Meanwhile, FTX has now achieved a market valuation of $32 billion last month. It raised $400 million from firms such as SoftBank, Tiger Global and Temasek. By implication, the FTX exchange is now more valuable than Twitter, Nasdaq, and Deutsche Bank.
Despite the growth, Sam Bankman-Fried indicated he has no interest to take the company public yet. He said, ´”We don’t need the capital, we’re profitable. We’re gonna do whatever feels right for the company.”
While the company experienced a low start three years ago, things picked up in 2021. The exchange recorded 5 million users by the end of the year. It also recorded a peak daily trading of $60 billion in May.
Three keys to FTX’s success are rare crashes to the system, its unique policy on margins, and its future derivatives. With its users spread evenly between individuals and institutions, FTX is in line for scrutiny by regulators and lawmakers.