Democratic Senator Elizabeth Warren, known to many as an outspoken cryptocurrency critic in the US government, criticized stock market disruptions and high transaction fees in times of market volatility.
In a hearing before the Senate Banking, Housing and Urban Affairs Committee Tuesday with Securities and Exchange Committee Chairman Gary Gensler, Warren said the cryptocurrency sector is not offering solutions for financial inclusion in the United States. He mentioned declines in cryptocurrency prices, including Bitcoin (BTC) and Ether (ETH), last week and said that “$ 400 billion market value has disappeared “, while many users reported access issues to major exchanges like Coinbase.
Warren indicated that Investing in decentralized finance projects (DeFi) are “very risky” as many are not registered with the SEC and do not necessarily fall under its regulatory framework. He also highlighted some of the high transaction rates in times of volatility, in this case on Jan. The BTC price has fallen from $ 52,920 to an intraday low of $ 42,843.
“The commission for trading between two cryptocurrency tokens on the Ethereum network was more than $ 500.” Warren said, referring to trading a hypothetical token worth $ 100.Given these high and unpredictable fees, retail investors could easily get bogged down and disappear altogether. “
“Proponents say that cryptocurrency markets are all about financial inclusion, but the people who are most vulnerable are most likely to have to withdraw their money faster when the market collapses.” […] High and unpredictable commissions can make cryptocurrency trading really dangerous for non-millionaires. “
During the two-hour hearing, Gensler addressed several questions from U.S. lawmakers about a policy framework for cryptocurrencies, a requirement that companies disclose weather risks to investors, and other issues that could affect the SEC. In a statement released yesterday for his testimony, he encouraged cryptocurrency projects to meet with SEC officials to offer the securities platforms in the form of digital assets.
Senator Warren has often criticized cryptocurrencies for being linked to many illegal activities such as “rogue technology”, fraud, and the industry’s impact on climate change. Last month, he proposed banning US banks from holding the reserves to support private stablecoins.