Bitcoin prices were on the slide on Thursday after the chair of the US Senate’s Subcommittee on Economic Policy pressured the headof the Securities and Exchange Commission (SEC) to come up with answers on the crypto market with a view to crafting new legislation to regulate the sector.
Massachusetts Senator Elizabeth Warren warned that the “highly opaque and volatile” crypto market posed growing risks to consumers and financial markets, according to a Reuters report, adding that the lack of regulation governing the market was unsustainable.
“Cryptocurrency exchanges don’t have the same commonsense regulations as traditional securities exchanges to protect consumers from scams or manipulation. I’m asking the SEC to explain how it can close the regulatory gaps & ensure a safe crypto marketplace”, Warren tweeted on Thursday.
Warren also said in a letter to SEC chair Gary Gensler on Wednesday that she required answers by July 28 on the watchdog’s authority to protect consumers that invest and trade crypto and whether congressional action was needed in the future to craft new rules for the market.
The letter also warned that crypto trading platforms lacked the same protections as traditional exchanges. Warren also requested information on whether digital currency exchanges were undermining the SEC’s ability to ensure markets operate in a “fair, orderly and efficient manner”.
The increasing pressure on the market from Congress piled pressure on Bitcoin prices, which sank 6.3% to US$32,592 in late afternoon trading in London.