JPMorgan notes that U.S. regulatory initiatives garnered more interest following the Terra collapse in May as there was a "perceived need for increased oversight and consumer protections." There is likely to be more urgency following FTX’s November collapse.
Regulatory initiatives are likely to emerge focusing on custody and protection of customers’ digital assets, the unbundling of broker/trading/lending/clearing/custody activities, and transparency and the reporting of reserves, assets and liabilities, the note said.
And JPMorgan says crypto derivatives trading will probably shift to regulated venues, and the Chicago Mercantile Exchange (CME) is likely to benefit from this transition.