Bank of UK: Fall of cryptocurrencies shows need for tougher rules

Bitcoin cryptocurrencies / Photo: EPA-EFE / SASCHA STEINBACH

Britain's central bank warned today that recent cryptocurrency crashes that wiped out more than $2 trillion underscore the need for tougher financial regulation.

The bank said the declines exposed flaws in crypto markets reminiscent of earlier financial turmoil.

Extreme volatility in crypto markets has led to massive sell-offs and intense price declines, the bank said in its latest financial stability report.

While overall financial stability is not at risk, the bank is concerned that "systemic risks" will grow as cryptocurrencies become more intertwined with the broader financial system.

The bank called for "improved regulatory and law enforcement frameworks".

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