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FTX Exchange’s founder and CEO Sam Bankman-Fried offered a reassuring perspective on this year’s plummet in crypto asset prices on Monday, arguing at the SALT conference in New York that the decline was part of a broader sell-off on Wall Street.
“Everything's down this year because dollars are up this year,” Bankman-Fried, a multibillionaire and crypto industry heavyweight, told interviewer and one-time Donald Trump press secretary Anthony Scaramucci at the conference, which is focused on “disruptive innovation.”
Since the start of this year, prices in crypto assets have declined by over 60 percent. Bitcoin plummeted from its high of roughly $68,000 in November 2021 to just over $22,000, with Ethereum joining the free-fall from $4,891 to $1,752 today.
After hitting roughly $2.8 trillion, the crypto industry now struggles to maintain a total capitalization of $1 trillion.
Bankman-Fried, however, argued that the sell-off was not particular to the industry and that the Federal Reserve’s decisions to raise interest rates to challenge inflation had “decreased the value of risk assets” in general.
“That happens,” he said. “But that doesn’t change the underlying or the fact that blockchain still has huge use cases in terms of financial settlement, in terms of payments, in terms of on-chain social media, in terms of other things.”
FTX chief calls for ‘federal oversight’ of crypto industry
The FTX chief struck a similarly measured view on the debate over regulatory oversight in Washington.
Crypto lobbyists have been hard at work wrangling regulatory authority from the Securities and Exchange Commission, arguing that the Commodities and Futures Trading Commission is better suited to monitor the industry.
Bankman-Fried was more circumspect. “Some way, somehow, there has to be reasonable federal oversight of the industry,” he said. “There has to be an agency, or multiple agencies, that are in charge of policing the space. The SEC and CFTC are the two most natural places to do that—they're both going to have some role in doing that one way or another.”
He added that FTX had been actively applying to both agencies and was working with congress to “draft legislation that would codify” whatever oversight emerges.
“I’m optimistic we’re going to get a license,” he said, predicting more clarity within a year. “I’m actually surprisingly optimistic that that will actually happen, that a year from now, there will have been a bill for a framework for digital assets.”
It’s a view not necessarily shared by the regulators themselves, however.
At the recent Crypto Policy Symposium in London, former SEC official John Stark argued that the SEC was likely to pursue more enforcement against the industry in the coming months. He argued that there already was “regulatory clarity,” albeit opposed to the interests of industry insiders like Bankman-Fried.
Markets and imminent regulation notwithstanding, the venture arm of Bankman-Fried’s company has continued a shopping spree that began at the height of last year’s crypto boom.
Just last week, it purchased a 30% stake in Skybridge Capital, a venture fund run by Scaramucci that plans to invest $40 million in crypto holdings.