Prompted by the news of last week’s bankruptcy, White House Press Secretary Karine Jean-Pierre was asked at a recent press conference if regulators should be taking a “harder look” at the crypto industry. Secretary Karine Jean-Pierre responded that “the most recent news further underscores these concerns and highlights why prudent regulation of cryptocurrencies is indeed needed.” She added that “without proper oversight of cryptocurrencies, they risk harming everyday Americans.” U.S. Senator Elizabeth Warren also stressed that the crypto industry needs more “aggressive” regulation. She tweeted, “[w]e need more aggressive enforcement and I’m going to keep pushing [the] SEC to enforce the law to protect consumers and financial stability.” Meanwhile, an executive at a large cryptocurrency exchange based in the U.S. tweeted: “Enforcement is important, but we need to start with clear rules. That’s good for markets and for investors.”

As we have previously noted, earlier this year, President Biden signed an executive order urging government agencies to work on a whole-of-government strategy for regulating the crypto industry. Based on the events of last week, Congress and the federal government may move more quickly to establish clear regulations for the crypto industry.