Regulatory clarity for crypto would take 3 to 5 years, FTX CEO says
Running a successful crypto business requires close attention to the cloud of regulatory changes put forth by governments. Sam Bankman-Fried, CEO of prominent crypto exchange FTX, featured in a CNBC International interview to discuss his efforts on this front.
During the conversation, Bankman-Fried highlighted FTX’s efforts to stay on top of the changing regulatory landscape. As a part of this move, the entrepreneur shared his company’s drive toward applying for licenses across numerous jurisdictions. Pointing out the need to be responsive to changing regulatory landscapes, he added:
“I’m spending five hours a day on everything from regulation to licensing and everything in between.”
As the CNBC spokesperson discussed the ongoing regulator’s concerns over the Know Your Customer (KYC) and Anti-Money Laundering (AML) front, the FTX CEO clarified that the KYC and AML requirements change for each jurisdiction.
Foreseeing the need for more clarity in the regulatory space, Bankman-Fried expects governments to have a clearer stance in the next three to five years. He further stated his wish to become a part of the discussions with the regulators “to build out this regime.”
On the other hand, he did admit that few governments lead this space to provide a framework for running a crypto business. Touching on the subject of Tether (USDT) and its controversial U.S. dollar backing, Bankman-Fried clarified that FTX treats USDT as any other free-floating crypto, saying:
“The [FTX] exchange doesn’t treat it [USDT] as necessarily one-to-one with the U.S. dollar. That’s for the market and users to determine.”
However, the CEO stated that he has not come across a report that suggests that USDT should be priced massively away from the U.S. dollar.
A recent report from last week showcased FTX’s latest efforts to reduce trading risks by limiting the leverage on its crypto exchange. With an over 80% drop, FTX users can now leverage their trades up to 20x, which was previously standing at a staggering 101x.
While the news may have disheartened pro-risk traders, the overall notion toward this move remains positive. The exchange has not reported any reduction in daily trading volumes following the announcement.