US Lawmaker Ron Wyden Asks Major Exchanges To Clarify User Protection Measures

Following FTX’s liquidity concerns and insolvency, US Senate Finance Committee Chair Ron Wyden has sought information from six crypto companies on consumer protection.

According to the senator, crypto users who have funds with FTX have no such protections as those at banks or registered brokers under the Federal Deposit Insurance Corporation (FDIC) or Securities Investor Protection Corporation.

Separate letters dated November 28 were sent to Binance, Coinbase, Bitfinex, Gemini, Kraken, and KuCoin, demanding information on what safeguards the exchanges had in place in the event of a breakdown similar to the one that occurred at FTX.

Wyden has asked the six companies to respond by December 12 to questions about their subsidiary companies, consumer asset safeguards, use of customer data, and market manipulation safeguards. The letter reads:

“As Congress considers much-needed regulations for the crypto industry, I will focus on the clear need for consumer protections along the lines of the assurances that have long existed for customers of banks, credit unions, and brokers.”

In addition, on December 1, the Senate Agriculture Committee will hold a hearing to investigate the failure of FTX, and Senators Elizabeth Warren and Sheldon Whitehouse have asked the Justice Department to investigate individuals involved in wrongdoing at the potential exchange.

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