Fri, March 29

Sam Bankman Fried’s Empire FTX Facing Scrutiny

Sam Bankman Fried’s Empire FTX Facing Scrutiny Editors News
  • SEC, CFTC, and DOJ are investigating FTX.
  • SEC investigation began before Binance purchased FTX.com.

The Sam Backman Fried exchange FTX is under regulatory scrutiny in the US as a consequence of Binance’s withdrawal from the acquisition of FTX. The United States Securities and Exchange Commission is investigating into cryptocurrency exchange. The Commodity Futures Trading Commission (CFTC), according to Bloomberg, is also probing the cryptocurrency exchange.

SEC and CFTC Investigation Against FTX

Based on the source, the SEC and CFTC investigations are related to FTX’s liquidity crisis, which Binance CEO Changpeng “CZ” Zhao has described as significant.

According to the report, the SEC and CFTC are probing how FTX has managed customers and attempting to gain a clear understanding of FTX and FTX US’s organizational structures. Regulators would be concerned about any crossover between the two, as well as any lack of separation between customer accounts. 

Additionally, they mentioned that the SEC is already looking into the FTX’s management activities and that of its FTX U.S. arm months. In addition to these government organizations, the DOJ is also looking into potential fraud.

According to the filing, the Texas Security Board started looking into FTX, FTX U.S., and CEO Sam Bankman Fried last month for reportedly breaking security laws.

Sam Bankman-Fried briefed investors that FTX needed $8 million to stay afloat or risk declaring bankruptcy. As a result of these events, the price of the FTT token has fallen to $2.43, down 46.79%, and the global market is also down to 7.50%.

Zhao said that 

“Users’ confidence has been severely shaken as a result of FTX’s decline. Exchanges will be scrutinized even more closely by regulators. Licenses will be more difficult to obtain around the world.”

A passionate writer who  is keenly exploring crypto and Blockchain loves to know about new things and exploring what is happening in world.