United States Senator Elizabeth Warren has hit out at the fake audits currently ongoing in the crypto market. In a statement released by Senator Warren and Wyden, the lawmakers tasked the oversight boards of public company accounts (PCAOB) to go after auditors for any failed projects.
Senator Warren wants a tightened regulation
The oversight board recently stated in a report that proof of reserves is not equal to audits. The body also clarified that firms have failed to follow the PCAOB standards of auditing for a while now. Crypto firms and other related platforms have been using the proof of funds method to confirm that users’ funds are available at their disposal. However, Senator Warren has tasked the board with making stringent regulations.
She said that the body needs to do more work so that consumers do not lose their funds anytime a firm goes bankrupt in the crypto sector. However, there has been a lot of backlash from the crypto community on Twitter after reports said that Silicon Valley Bank was in cold waters. This was because the bank’s collapse affected the price of USDC, a circle-issued stablecoin. Users were quick to ask Senator Warren for her opinion regarding the collapse of a bank without crypto affiliations.
Crypto executives show displeasure over SVB collapse
One of the numerous responses to Senator Warren’s warning was a reply by a blockchain firm executive. Blocktower Capital boss Paul Ari highlighted the way financial institutions have been driving crypto and the firms in the sector down over the last few years. He also mentioned the case of SVB and how it is doing damage in the crypto sector presently. Ari told Senator Warren that the bank’s collapse have put many firms in the same state.
He clarified that most of these banks have been bringing in losses for crypto trades and firms. Twitter boss Elon Musk also shared a meme that deputed the issues that traders face when choosing where to keep their funds. Circle claimed that it had $3.3 billion in the collapsed SVB after a transfer it put through was not completed. Executives at the company have asked the FDIC for help as it continues to try to protect USDC from being a failure.
