U.S. Treasury Secretary Janet Yellen called for more effective oversight of cryptocurrencies Wednesday amid the recent market meltdown.

"The recent failure of a major cryptocurrency exchange and the unfortunate impact that has resulted for holders and investors of crypto assets demonstrate the need for more effective oversight of cryptocurrency markets," Yellen said in a statement.

"We have very strong investor and consumer protection laws for most of our financial products and markets that are designed to address these risks. Where existing regulations apply, they must be enforced rigorously so that the same protections and principles apply to crypto assets and services," she added.

The Treasury chief also urged the government and Congress to move quickly in filling regulatory gaps and warned that spillovers from the crypto market could raise broader financial stability concerns. She noted that some risks in the crypto market include a lack of transparency and conflicts of interest in the past week.

Yellen's comments come after cryptocurrency exchange platform FTX, which was the world's third-largest by daily trading volume, filed for bankruptcy last Friday with liquidity struggles.

The price of Bitcoin, the world's largest crypto by market size, was trading around $16,550 at 8:05 a.m. EDT for a 2% daily loss. It has been down significantly from an all-time high of more than $64,000 which was seen in the first half of 2021.

The value of the cryptocurrency market was down 1.9% to $829 billion at the time, according to data from digital asset price-tracking website CoinMarketCap. It has plummeted from a record high of $3 trillion last year.