Before the FTX declared bankruptcy, the U.S. SEC allegedly met with its former CEO, Bankman. FTX was allegedly receiving legal assistance from Gary Gensler, chairman of the SEC. An opposing perspective is suggested by a recent report, though.
Sam Bankman-Fried And FTX Meet With Gensler
There are claims that Gary, the chairman of the SEC, assisted former FTX CEO Bankman. He was helping his bankrupt exchange by leveraging legal loopholes to achieve a regulatory monopoly. These events followed the bankruptcy filing of the cryptocurrency exchange FTX. Some have even said that the head of the SEC was prepared to send FTX a letter of no action.
Gensler met with Bankman-Fried in March, according to his schedule. Members of the Chair in Gensler’s staff met with staff from IEX and FTX. This is information according to an SEC meeting note. The meeting was to discuss the possession of digital asset securities by a purpose realtor. Also, the risks involved with possessing digital asset equities and the no-action relief.
Gensler And FTX Relationship
Up until FTX’s collapsed, follow-up discussions with the SEC persisted. However, no SEC approval was indicated. Given Bankman’s political leanings, the House GOP may want to reconsider. They wanted to hold hearings on FTX by summoning Gensler as a witness. According to sources, Gensler said he wanted strong control and standards. Also, there was no certainty of approval when he spoke to Brad Katsuyama and Bankman-Fried.
Many people have voiced their convictions online. They claim that Gensler or other SEC employees were aiding FTX. Some speculated that Bankman’s substantial contribution to the Democratic Party is why. Bankman gave $39.8 million to the Democrats between 2021 and 2022, the second highest donor.
Gensler said last week that he did meet with Bankman-Fried in an interview with CNBC. “I think we’ve been explicit in these discussions,” the SEC chairman stated. Non-compliance will not succeed, and it will harm the public.
Gensler Regulations
The SEC chair uses an enforcement-focused stance to regulate the crypto business. He has received a lot of flak. Gensler has urged crypto trading and lending firms to register with the SEC. Brad Garlinghouse, CEO of Ripple, made a remark stated in September last year. He said that the SEC is generating leads for enforcement proceedings from meetings. They are doing this while they are supposed to be cooperating with the crypto industry. His business is now battling the SEC over the purchase and sale of XRP.
Media publications say that FTX is the subject of an investigation. The investigation is conducted by SEC and the Commodity Futures Trading Commission. They are looking into alleged improper management of customer cash.