Forbes - 💥 Crypto crisis

Sub-prime: Pointing directly to the spiraling value of U.S. sub-prime mortgages before the 2008 financial crash, Cunliffe, who's the deputy governor of the U.K.'s central bank, said a full-blown crypto crash could rock financial markets to a similar degree.

By the numbers: "Of course $2.3 trillion needs to be seen in the context of the $250 trillion global financial system," Cunliffe said in a speech yesterday. "But as the financial crisis showed us, you don’t have to account for a large proportion of the financial sector to trigger financial stability problem—sub-prime was valued at about $1.2 trillion in 2008."

Mania meltdown: In 2008, "a relatively small market was amplified and reverberated through an unresilient financial system, causing huge and persistent economic damage," said Cunliffe. Earlier this year, Viktor Shvets, a managing director at Macquarie, told the Odd Lots podcast the next financial crisis could originate in the mania for cryptocurrencies.

Why it matters: Cunliffe has played a central role in monitoring cryptocurrencies over recent years as an adviser to the G20’s financial stability board and the Geneva-based Bank of International Settlements. The Guardian writes "his warning is likely to grab the attention of senior treasury officials in the U.K., Washington and Tokyo."

The bottom line: Regulation is coming for crypto from all angles.

Now read this: Ted Cruz says bitcoin will stabilize Texas electric grid—here’s why he’s wrong