Following the collapse of the Bahamas-based exchange FTX.com, Christine Lagarde, president of the European Central Bank (ECB), stated at the European Parliament’s Committee on Economic and Monetary Affairs on Monday that regulating cryptocurrency in the European Union (EU) is a “absolute necessity.” Legarde stated that the EU has already taken significant steps toward effectively regulating the space, referring to the Markets in Crypto Assets bill (MiCA) that is currently being debated in the European Parliament. Legarde cited Meta Platform Inc.’s short-lived stablecoin project Diem as an example of when the ECB was able to keep some industry players out of the project; however, she stated that FTX was different because it was about the industry’s stability and reliability.
