Sun, June 23

California Becomes the First U.S. State to Launch Investigation on the Collapse of FTX

California Becomes the First State to Launch Investigation on the Collapse of FTX Exchange News
  • California’s DFPI started to investigate the FTX liquidity crisis. 
  • The DFPI regulators requested the affected consumers to “File a complaint”.
  • Thus, California becomes the first U.S. state to initiate the probe. 

The current critical crisis of FTX crypto exchange is creating a significant impact on the whole crypto market. It is becoming the hottest story in the town, affecting large users and the investors. In addition, prices fell dramatically for all the cryptocurrencies. As the situation worsens day by day, the California’s Department of Financial Protection and Innovation (DFPI) is initiating their investigation on the FTX collapse. 

Further, when the largest crypto exchange in the world, Binance stepped back in acquiring FTX, it increased the risk of bankruptcy for FTX. Thereby, California became the first U.S state to officially reveal its investigation into the FTX issue. 

As per the regulations of California, the DFPI team is responsible to monitor the state’s lending and banking laws. Thus, the ongoing liquidity crisis of FTX is taken in-charge by the state’s securities and protection department. 

California’s DFPI Announces Investigation on FTX

Following, the DFPI regulators requested all affected consumers to raise their concern in the official website of DFPI’s “File a Complaint” page. In addition, the DFPI authorities listed all the illegal cases and violations which fall within the DFPI jurisdiction. 

During the research, the DFPI regulators found that FTX is not a registered money transmitter in the state of California. So dig deep into the ongoing liquidity crash of FTX, other notable authorities like the U.S. Securities and Exchange Commission (SEC), the Department of Justice (DOJ) and the Commodity Futures Trading Commission (CFTC) also initiated the investigations of the cryptocurrency exchange

More so, the DFPI is responsible for this serious issue in its state. Thereby the regulators states, 

“We expect any person offering securities, lender, broker dealers, investment advisers or other financial services commodities that operates in California to comply with our financial laws.”

Additionally, the Texas State Securities Board also started to probe into the FTX liquidity crunch.

A Professional HR with a huge interest in blockchain technology and cryptocurrency. Through her content writing skills, she became a passionate contributor to the crypto space. Being an active crypto enthusiast she is investing her time and experience into the digital sphere.