At a press conference on Thursday, White House press secretary Karine Jean-Pierre stated that the Biden administration has “constantly maintained that without proper oversight of cryptocurrencies, they risk harming everyday Americans.”
The White House’s stance on crypto regulation comes during a particularly turbulent time for digital currencies, as the collapse of the cryptocurrency FTX happened earlier this week.
Related: ‘I’m sorry. That is the most important.’ Sam Bankman-Fried and Cryptoworld Lose Big in FTX Meltdown, Corporate Files for Bankruptcy.
“The latest news further underscores these concerns and highlights why prudent regulation of cryptocurrencies is indeed necessary,” said Jean-Pierre.
With FTX at risk of bankruptcy, the company and its founder Sam Bankman-Fried are under extensive investigation for mishandling of customers’ money, Bloomberg said. reported. The investigation examines the possibility that Bankman-Fried ran a Ponzi scheme similar to Bernie Madoff’s by channeling client deposits into his hedge fund.
Related: Kevin Bacon Admits He Lost ‘Most’ of His Net Worth to Bernie Madoff’s ‘Too Good to Be True’ Ponzi Scheme
The ramifications for investors could be catastrophic, which may be why the White House is determined to tighten regulations and oversight to prevent another FTX meltdown in the future.
Bankman-Fried took to Twitter to address the controversy, to write “I screwed up, and should have done better,” before kicking off a 22-part thread that ended with “My sincere apologies. We’ll continue to share updates as we have them.”