EU watchdog calls for curbing leverage in crypto trading

European Union authorities should curb leveraged bets on crypto assets by introducing limits for investment funds, exchanges and other firms to stop shocks in that industry from jeopardising financial stability elsewhere, an EU watchdog said on Thursday.

It was one of several recommendations made by the European Systemic Risk Board, which ranged from demanding regular reports from all companies involved with crypto assets to introducing specific rules for the largest firms in that space.

It follows a tumultuous 18 months for that industry, during which the price of bitcoin dropped as much as 77%, the cryptocurrency Luna collapsed and exchange FTX went from buying Super Bowl ads to landing into bankruptcy.