SNEAK PEEK

• Regulators intervened to guarantee crypto firms’ deposits during the recent banking crisis.
• Senator Elizabeth Warren criticized the move, citing the struggles of student loan borrowers.
• The situation has raised concerns about inequality and unfair treatment in the financial system.

Susan Friedman, a policy influencer at Ripple, has responded to recent criticisms by Senator Elizabeth Warren about the government’s handling of the crypto industry. In a tweet, Friedman reminded Senator Warren that the crypto industry is a legitimate and legal sector that deserves to be banked.

And a point that bears repeating – crypto is a legal industry within the US and globally that deserves to be banked.

— Susan Friedman (@ss_friedman) March 13, 2023

Senator Warren had expressed concerns about the government’s quick intervention to protect billion-dollar crypto firms from losing deposits. However, Friedman pointed out that if the government had not stepped in, many businesses, not just those in the crypto industry, would have faced devastation.

According to a post by Sen. Warren regulators have announced that they will guarantee the repayment of all deposits at SVB and Signature, ensuring that all customers, from small businesses and nonprofits to large billion-dollar companies and even crypto investors, will receive their total deposits. 

This intervention was allegedly aimed at preventing any further spread of the banking crisis, which had been triggered by venture capital firms and had caused a bank run on S.V.B.

However, according to Warren, the American people are increasingly skeptical of a financial system that appears to prioritize the interests of billion-dollar crypto firms over those of struggling student loan borrowers.

Nevertheless, Friedman’s comments come amid increasing scrutiny of the crypto industry, with some policymakers expressing concerns about its potential impact on financial stability and consumer protection. Despite this, the industry has continued to grow, and many advocates believe that it has the potential to revolutionize the traditional financial system.