When crypto markets took a hit after the collapse of FTX and other crypto lenders last year, some crypto critics repeated the mantra, “Let crypto burn.” Now, it’s big banks that are faltering — including Credit Suisse and First Republic — after regional banks, including Signature Bank (NASDAQ:SBNY) and Silicon Valley Bank, sparked a cascade. As a result, Moody’s has downgraded the entire banking sector.
If “Let crypto burn” was a snappy way of saying that operating outside the financial system means more personal responsibility and heightened risk, fine, crypto natives understand that concept. But now, we have a chance to turn a critical lens on the traditional financial system.
J.W. Verret is an associate professor at the George Mason Law School. He is a practicing crypto forensic accountant and also practices securities law at Lawrence Law LLC. He is a member of the Financial Accounting Standards Board’s Advisory Council and a former member of the SEC Investor Advisory Committee. He also leads the Crypto Freedom Lab, a think tank fighting for policy change to preserve freedom and privacy for crypto developers and users.