{"id":1768148,"date":"2022-12-08T16:48:04","date_gmt":"2022-12-08T21:48:04","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1768148"},"modified":"2022-12-08T16:48:10","modified_gmt":"2022-12-08T21:48:10","slug":"elizabeth-warren-asks-federal-reserve-to-investigate-banking-systems-exposure-to-crypto","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/elizabeth-warren-asks-federal-reserve-to-investigate-banking-systems-exposure-to-crypto\/","title":{"rendered":"Elizabeth Warren Asks Federal Reserve To Investigate Banking System\u2019s Exposure To Crypto"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">24<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Felizabeth-warren-asks-federal-reserve-to-investigate-banking-systems-exposure-to-crypto%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1768148&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>Sen. <a href=\"http:\/\/dailywire.com\/topic\/elizabeth-warren\" target=\"_blank\" rel=\"noopener\">Elizabeth Warren<\/a> (D-MA) and Sen. Tina Smith (D-NM) asked the <a href=\"http:\/\/dailywire.com\/topic\/federal-reserve\" target=\"_blank\" rel=\"noopener\">Federal Reserve<\/a> to examine the <a href=\"http:\/\/dailywire.com\/topic\/banks\" target=\"_blank\" rel=\"noopener\">banking<\/a> system\u2019s exposure to <a href=\"http:\/\/dailywire.com\/topic\/cryptocurrency\" target=\"_blank\" rel=\"noopener\">cryptocurrencies<\/a> amid continued fallout from defunct company FTX.<\/p>\n<p>In a <a href=\"https:\/\/www.warren.senate.gov\/imo\/media\/doc\/Letter%20to%20Regulators%20re%20Banking%20System%20Exposure%20to%20Crypto.pdf\" target=\"_blank\" rel=\"noopener\">letter<\/a> addressed to Federal Reserve Chair Jerome Powell, the lawmakers noted that cryptocurrency firms have desired the \u201cbenefits that come with federal recognition from bank regulators\u201d but have not thus far generated a salient degree of partnerships with major financial institutions. The Democrats asked for information about the central bank\u2019s process for evaluating relationships between banks and cryptocurrency companies.<\/p>\n<p>\u201cBanks\u2019 relationships with crypto firms raise questions about the safety and soundness of our banking system and highlight potential loopholes that crypto firms may try to exploit to gain further access to banks,\u201d Warren and Smith wrote. \u201cWhile the banking system has so far been relatively unscathed by the latest crypto crash, FTX\u2019s collapse shows that crypto may be more integrated into the banking system than regulators are aware.\u201d<\/p>\n<p>The letter noted that other cryptocurrency companies, such as BlockFi, have also filed for bankruptcy as a <a href=\"https:\/\/www.dailywire.com\/news\/crypto-company-blockfi-files-for-bankruptcy-after-ftx-collapse\" target=\"_blank\" rel=\"noopener\">liquidity crisis<\/a> continues to upend the nascent sector. Voyager and Celsius declared bankruptcy earlier this year, while other cryptocurrency firms such as Genesis have <a href=\"https:\/\/www.dailywire.com\/news\/second-major-cryptocurrency-exchange-could-be-poised-to-go-bankrupt\" target=\"_blank\" rel=\"noopener\">indicated<\/a> the looming possibility of insolvency.<\/p>\n<p>A number of smaller banks, including Silvergate Capital, Provident Bancorp, Metropolitan Commercial Bank, Signature Bank, and Customers Bancorp, have ties to cryptocurrency ventures. Alameda Research, the company controlled by former FTX CEO Sam Bankman-Fried which allegedly pulled customers\u2019 funds from the exchange to make investments, poured $11.5 million into Moonstone Bank, more than doubling its value. The institution has connections with other offshore digital asset ventures.<\/p>\n<p>\u201cMany of these small banks relied heavily on their crypto customers and are now experiencing heightened volatility,\u201d continued Warren and Smith, both of whom serve as members of the Senate Banking Committee. An adjacent letter addressed to Federal Deposit Insurance Corporation Acting Chair Martin Gruenberg likewise inquired whether the agency is prepared to conduct a review of the banking system\u2019s ties with cryptocurrency companies.<\/p>\n<p>Among other data points, the letters requested the names of banks currently providing cryptocurrency services, holding dollar deposits for cryptocurrency-related firms, or facilitating transactions via stablecoin. With respect to Moonstone Bank and Alameda Research, the lawmakers asked whether the latter\u2019s investment constituted \u201ccontrol\u201d of the former under the Bank Holding Company Act.<\/p>\n<p>The House Financial Services Committee is <a href=\"https:\/\/www.dailywire.com\/news\/bipartisan-committee-to-hear-from-sam-bankman-fried-and-crypto-allies-next-month\" target=\"_blank\" rel=\"noopener\">preparing to hold<\/a> hearings regarding the collapse of FTX, which is based in the Bahamas; members of the Senate Agriculture Committee <a href=\"https:\/\/www.dailywire.com\/news\/top-commodities-regulator-tells-senators-he-met-with-sam-bankman-fried-10-times\" target=\"_blank\" rel=\"noopener\">held a hearing<\/a> last week with Commodity Futures Trading Commission Chairman Rostin Behnam on increasing federal oversight of the cryptocurrency sector. Officials at the Securities and Exchange Commission have opened a criminal investigation into Bankman-Fried to determine whether the entrepreneur broke the law by transferring FTX customer funds to Alameda Research, according to a <a href=\"https:\/\/www.dailywire.com\/news\/federal-prosecutors-open-criminal-investigation-into-disgraced-ftx-founder-sam-bankman-fried-report-says\" target=\"_blank\" rel=\"noopener\">report<\/a> from The New York Times.<\/p>\n<p>Cryptocurrency, a form of decentralized <a href=\"https:\/\/www.dailywire.com\/news\/what-exactly-is-bitcoin-heres-how-the-worlds-largest-cryptocurrency-actually-works\" target=\"_blank\" rel=\"noopener\">digital money<\/a> that can be transferred between users\u2019 virtual wallets, has garnered the skepticism of many regulators. JPMorgan Chase CEO Jamie Dimon, comparing the assets to \u201cpet rocks\u201d during an <a href=\"https:\/\/www.dailywire.com\/news\/a-complete-sideshow-jpmorgan-chase-ceo-jamie-dimon-says-cryptocurrencies-are-like-pet-rocks\" target=\"_blank\" rel=\"noopener\">interview<\/a> with CNBC this week, has raised concerns about \u201cterrorism financing, tax avoidance, sex trafficking,\u201d and other ways in which cryptocurrencies enable illicit activities.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Sen. Elizabeth Warren (D-MA) and Sen. Tina Smith (D-NM) asked the Federal Reserve to examine the banking system\u2019s exposure to cryptocurrencies amid continued fallout from defunct company FTX. In a letter addressed to Federal Reserve Chair Jerome Powell, the lawmakers noted that cryptocurrency firms have desired the \u201cbenefits that come with federal recognition from bank &#8230;<\/p>\n","protected":false},"author":99,"featured_media":1130772,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[541],"tags":[],"class_list":["post-1768148","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-daily-wire"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1768148","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/99"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1768148"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1768148\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1130772"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1768148"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1768148"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1768148"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}