Former SEC enforcement official John Reed Stark and Duke University lecturer Lee Reiners warn that the Securities and Exchange Commission’s relaxed oversight of digital assets could lead to conditions similar to those before the 2008 financial crisis. They argue that the SEC’s rollback of crypto-specific enforcement efforts may create opaque linkages across financial institutions. Regulatory retrenchment, industry expansion, and potential liquidity risks in the market integration of digital assets are highlighted. They also discuss the involvement of federal politics in crypto-linked funding and the potential consequences of future token failures on pension funds and deposit accounts. They suggest that a flashpoint event may be needed to compel institutional intervention in the crypto market.
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