Federal Reserve Chairman Jerome Powell has criticized the decentralized finance (DeFi) space, saying the monetary policy worldwide has “revealed significant structural issues” in the DeFi ecosystem while exposing “conflicts of interest.”

The head of crypto lender Celsius Network, Alex Mashinsky, has resigned with an apology to customers for the “difficult financial circumstances” they were left in by the company’s bankruptcy.

Commission-free trading platform Robinhood has announced the launch of its beta Web3 wallet with Polygon, giving 10,000 waitlisted customers the ability to participate in the wallet’s testing phase.

Top stories in the Crypto Roundup today:

• Federal Reserve Chair Calls for DeFi Regulation
• CEO of Bankrupt Crypto Lender Celsius Network Resigns
• Robinhood Launches Non-Custodial Crypto Wallet with Polygon to Beta Users
• Chart of the Week: Ethereum Outperforms Wider Crypto Market

Federal Reserve Chair Calls for DeFi Regulation

Federal Reserve Chairman Jerome Powell has criticized the decentralized finance (DeFi) space, saying the monetary policy worldwide has “revealed significant structural issues” in the DeFi ecosystem while exposing “conflicts of interest.”

The Chair of the United States’ central bank called for more appropriate regulation, and said that within the DeFi ecosystem there are very significant “lack of transparency” issues.

From a financial stability standpoint, Powell noted that the interaction between DeFi and the traditional financial system “is not that large at this point,” which means we could see a “DeFi winter” that would not have a significant impact on broader financial stability. Powell said:

“Ultimately that’s not a stable equilibrium and we need to be very careful about how crypto activities are taken within regulatory parameter. In any case, wherever they take place, there is a real need for more appropriate regulation so that as DeFi expands and starts to touch more retail customers, more appropriate regulation is in place.”

The Fed Chair had in the past expressed concerns about the risks of new digital financial products as how these products will behave in times of market stress is unclear.

CEO of Bankrupt Crypto Lender Celsius Network Resigns

The head of crypto lender Celsius Network, Alex Mashinsky, has resigned with an apology to customers for the “difficult financial circumstances” they were left in by the company’s bankruptcy.

The company filed for bankruptcy protection in July, saying it had a $1.2 billion hole on its balance sheet, effectively becoming one of the largest casualties in the cryptocurrency space this year.

Celsius offered users high-interest rates on some assets, who, as of now, do not know when or how much of their money they can expect to get back. Mashinsky will be replaced by Chris Ferraro, the company’s chief financial officer.

Over the last few weeks, leaks of internal Celsius meetings have suggested that the firm may propose a restructuring plan that involves giving customers a cryptoasset substitute for their claims, while launching a new business based on providing crypto custody services.

Robinhood Launches Non-Custodial Crypto Wallet with Polygon to Beta Users

Commission-free trading platform Robinhood has announced the launch of its beta Web3 wallet with Polygon, giving 10,000 waitlisted customers the ability to participate in the wallet’s testing phase.

The wallet application is currently only available on Apple devices, and will let users trade crypto with “no network fees,” and earn yield by connecting with other decentralized applications.

Robinhood’s wallet, in its beta version, won’t support non-fungible token (NFT) trading or marketplace activities, with these features expected to be rolled out in the wallet’s final rollout.

The firm noted that it selected Polygon as its exclusive blockchain partner because of the network’s “scalability, speed, low network fees, and robust developer ecosystem.”

Chart of the Week: Ethereum Outperforms Wider Crypto Market

Over the past couple of months, Ethereum has been outperforming the majority of the market on account of its historical Merge catalyst, with the chart above showing Ethereum’s performance against the MVIS CryptoCompare Digital Assets 100 Index, a market cap-weighted index which tracks the performance of the 100 largest digital assets

Macroeconomic conditions continue to weigh down the performance of risk assets, with Ethereum returns edging back to the return of the market index.

State of the Crypto by Top Tier Exchange Volume

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