A former financial regulator said Thursday that he wished he had invested in bitcoin and other popular cryptocurrencies back when he was telling everyone to be careful.

Bart Chilton, a former commissioner of the Commodity Futures Trading Commission, says he's been calling for cryptocurrency regulation since 2012. In the fall of 2017, when the price of bitcoin was fluctuating, Chilton said he would have sought an investigation into the "precipitous price changes" witnessed.

Chilton said Thursday that it's still the "Wild West" outside the regulated futures market, but added that the massive price fluctuations have since "mellowed out."

"I wish I had been investing when I told everybody to be careful," said Chilton, who says he now owns bitcoin and ethereum. "I had a lot of my friends that said, 'You told me not to invest.' They would have been millionaires."

Exchange operators such as CME Group and Cboe Global Markets have opened their platforms to allow bitcoin futures trading.

"There's a shaking out going on in the digital currency world," Chilton said in the interview with CNBC's "Squawk on the Street." "There's a lot of craziness out there, but as we go forward on CME and Chicago Board Options Exchange [I think] it is a first step at regularizing."

The price of bitcoin and other major cryptocurrencies fell this week after South Korea's justice minister announced that a bill is being prepared to ban all cryptocurrency trading in the country, citing concerns regarding virtual currencies. On Thursday the cryptocurrencies rose, rebounding from the declines.

Additionally, billionaire investor Warren Buffett, chairman and CEO of Berkshire Hathaway, recently warned that the recent craze over bitcoin and other cryptocurrencies won't end well.

J.P. Morgan Chase Chairman and CEO Jamie Dimon has criticized bitcoin but recently backpedaled a bit from his earlier comments.