24/7 Cryptocurrency News

FSB Warns Against FTX-Like Crypto Risks, Urges Global Safeguards

Published by

The Financial Stability Board (FSB), a global watchdog encompassing regulators, central banks, and treasury officials from G20 economies, has issued a stern warning about the potential destabilization of the broader financial system due to blow-ups at complex crypto firms like FTX. Meanwhile, in a report released on Tuesday, the FSB highlights the vulnerabilities inherent in “multifunction” crypto firms, emphasizing the need for additional measures to prevent their tumultuous impact on the global financial landscape.

Advertisement

FSB Urges Enhanced Regulatory Safeguards

The FSB’s latest report serves as a cautionary tale, shedding light on the risks posed by multifaceted cryptocurrency firms, especially in the aftermath of FTX’s collapse last year. Notably, the report underlines how these firms, engaging in a combination of trading and various other activities, can magnify vulnerabilities comparable to those seen in traditional finance.

Meanwhile, these vulnerabilities encompass issues such as leverage, liquidity mismatches, and technological and operational weaknesses.

In addition, the FSB draws attention to a concerning lack of effective controls, operational transparency, and disclosures, coupled with conflicts of interest, further amplifying the risks associated with these crypto entities. Although the evidence currently suggests a limited threat to wider financial stability and the economy, the FSB urges proactive measures to avert potential future crises.

Also Read: Ex-Binance CEO Changpeng ‘CZ’ Zhao Hires Veteran Federal Prosecutor Matthew Diggs

Advertisement

A Call For Cross-Border Cooperation and Enhanced Oversight

Earlier this year, the FSB and the International Organization of Securities Commissions (IOSCO) released high-level recommendations aimed at supervising crypto activities. Despite these efforts, the FSB emphasizes the necessity for regulators to assess the adequacy of these measures in preventing the amplification of crypto risks across the financial system.

Meanwhile, the recent report by FSB concludes by advocating for further work to enhance cross-border cooperation and information sharing, addressing the identified information gaps. Notably, in a landscape characterized by rapid technological evolution, the FSB underscores the importance of staying ahead of potential risks associated with crypto activities.

In addition, the FSB also emphasizes reinforcing a collaborative and globally coordinated approach to crypto regulation. As the crypto market continues to evolve, the FSB’s call for enhanced vigilance reflects the ever-growing significance of adapting regulatory frameworks to safeguard the stability of the broader financial ecosystem.

Also Read: Binance Lists EthereumPoW (ETHW) Perpetual Contract Triggering Price Rally

Advertisement

Share
Rupam Roy

Rupam is a seasoned professional with three years of experience in the financial market, where he has developed a reputation as a meticulous research analyst and insightful journalist. He thrives on exploring the dynamic nuances of the financial landscape. Currently serving as a sub-editor at Coingape, Rupam's expertise extends beyond conventional boundaries. His role involves breaking stories, analyzing AI-related developments, providing real-time updates on the crypto market, and presenting insightful economic news. Rupam's career is characterized by a deep passion for unraveling the complexities of finance and delivering impactful stories that resonate with a diverse audience.

Published by

Recent Posts

  • 24/7 Cryptocurrency News

Hyperliquid DEX Outperforms Top Crypto Exchanges Coinbase, Binance, Robinhood With Zero Downtime

Today's crypto market crash triggered major congestion at some of the top centralized exchanges like…

October 11, 2025
  • 24/7 Cryptocurrency News

Crypto Market Loses $670 Billion on CEX Auto Liquidations, Altcoins Crash Intensifies

The crypto market has witnessed the biggest single-day crash in history, with more than $19…

October 11, 2025
  • 24/7 Cryptocurrency News

Crypto Market Crash With 100% Trump Tariff Announcement on China

The crypto market is facing further declines following President Donald Trump’s announcement of a 100%…

October 11, 2025
  • 24/7 Cryptocurrency News

ASTER Airdrop Delayed to October 20 Amid Criticisms Over Token Allocations

Following complaints of consistency issues with the ASTER token airdrop, Aster DEX has announced a…

October 11, 2025
  • 24/7 Cryptocurrency News

U.S. Inflation Data: BLS to Release CPI Report on October 24 Amid Government Shutdown

The Bureau of Labor Statistics (BLS) has rescheduled the release of the September Consumer Price…

October 10, 2025
  • 24/7 Cryptocurrency News

Bank of America, Citigroup and Goldman Sachs Explore Issuing Stablecoins Pegged to G7 Currencies

A group of major world banks is working on a new stablecoin tied to G7…

October 10, 2025