Democratic Senator Elizabeth Warren, known to many as an outspoken crypto-skeptic in the U.S. government, has criticized the closings of exchanges and the high transaction fees during the reporting period.
During the Senate Banking, Housing, and Urban Affairs Committee hearing with Securities and Exchange Commission Chairman Gary Gensler on Tuesday, Warren alleged that the crypto industry had not provided solutions to financial inclusion in the United States. She mentioned the drop in the price of cryptocurrencies, including Bitcoin (BTC) and Ether (ETH) last week, and said that “$ 400 billion in market value is gone.” At the same time, many users report problems accessing significant exchanges like Coinbase.
Warren suggested that investing in decentralized finance or DeFi projects is “quite risky” as many are not registered with the SEC and do not necessarily fall within the regulatory framework. Additionally, she highlighted some high transaction fees during times of volatility – in this case, on September 7th, when the price of BTC fell from $ 52,920 to an intraday low of $ 42,843.
“The fee for exchanging two crypto tokens on the Ethereum network is over $ 500,” said Warren, trading a hypothetical $ 100 token. “Given these unpredictably high fees, it is easy for retail investors to get stuck and wiped out completely.”
Senator Warren-She added:
“Proponents say the crypto market is all about financial inclusion, but the weakest economically are the ones most likely to pay off when the market falls.” […] High, unpredictable fees can make cryptocurrency trading dangerous for the not-so-wealthy. “
Gensler addressed several questions from U.S. lawmakers during a two-hour hearing on a crypto-political framework that requires corporations to disclose climate risks to investors and other matters that the SEC may have. In an initial statement released yesterday for his testimony, he encouraged crypto projects to meet with SEC officials about the securities platforms can offer as digital assets.
Related: Senator Elizabeth Warren calls cryptocurrency the “new shadow bank.”
Senator Warren has often criticized cryptocurrencies for engaging in a wide variety of illegal activities, including “untrustworthy technology,” fraud, and the industry’s impact on climate change. Last month, she proposed banning U.S. banks from holding reserves to support private stablecoins.