Bank of England Calls for Rapid Regulation of Crypto World After FTX Collapse

Denver The British central bank got involved in the discussion about the future of the crypto industry after the insolvency of the crypto exchange FTX. In particular, tokens issued by exchanges themselves are “extremely risky” when used as collateral for crypto loans, said Jon Cunliffe, deputy head of the Bank of England (BoE) on Monday.

This circumstance had also accelerated the collapse of FTX, once the third largest crypto exchange. The FTT token made up a large part of FTX’s balance sheet, but was unbacked and could easily be digitally created by FTX. The sister company Alameda had also deposited large amounts of FTT as collateral and is now also part of the insolvency proceedings.