BIS warns crypto exchanges mimic shadow banks

The Bank for International Settlements (BIS) has issued a stark warning regarding cryptocurrency exchanges, highlighting their increasing resemblance to 'shadow banks.' These platforms offer bank-like yield and lending products, often marketed to retail investors as passive income opportunities. However, the BIS report emphasizes that these services lack the crucial safeguards, transparency, and deposit insurance found in traditional banking. The report cites the collapses of Celsius and FTX, along with market volatility, as evidence of the significant risks users face due to the opacity and leverage inherent in these unregulated financial activities.