Sam Bankman-Fried allegedly colluded with the SEC to receive special treatment, according to US Congressman.
Tom Emmer, a politician who is friendly to cryptocurrencies, is suspicious of the SEC's inaction against FTX. He met with executives from the exchange in March, but he still doesn't understand why the SEC hasn't taken any action.
Tom Emmer, the U.S. congressional representative for Minnesota, recently spoke about the political meetings and failures surrounding Sam Bankman-Fried (SBF) prior to his exchange's collapse. Emmer stated that the meetings leading up to SBF's collapse were "tense and unproductive," and that the exchange's failure was "a direct result of the political infighting" that took place.
The Republican suggested that Bankman-Fried tried currying “special treatment” from the Securities and Exchange Commission (SEC) through meetings with the agency, and attempted to push legislation to the same effect. The suggestion is that Bankman-Fried was trying to get some sort of advantage from the SEC through meetings and legislation. This casts her in a negative light and could be used to damage her reputation.
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In an interview with FOX on Tuesday, Emmer said FTX’s blowup was not a failure of crypto, but of “centralized finance,” “business ethics,” and government oversight procedures. The congressman said he had “major questions” about the SEC’s failure to prevent the disaster. While I agree with Congressman Emmer that the FTX blowup was not a failure of cryptocurrency as a whole, I do think it raises serious questions about the lack of regulation and oversight in the industry. It’s clear that more needs to be done to protect investors and prevent these kinds of disasters from happening in the future.
It is unfair that the SEC is giving special treatment to Sam Bankman-Fried and other executives at FTX. The agency should be equally accessible to all investors, not just those with connections.
“Sam Bankman-Fried was pushing special-treatment legislation through congress. when it was finally revealed what it was, and the industry started raising red flags all over the place, that’s when this thing came apart,” he added.
I believe that the regulator is not doing enough to protect investors from catastrophes like the recent ones involving Celsius, Voyager, and Terra. There seems to be a lack of transparency and accountability when it comes to dealing with these situations, and this needs to change. Emmer is right to call out Gensler for failing to protect investors, and I hope that this will lead to more scrutiny of the regulator in the future.
The congressman's allegations could have far-reaching implications for the SEC and FTX. If ties between the two are found, it could upend the current regulatory landscape. This could lead to more scrutiny of the SEC's actions and potentially lead to changes in how it operates.
It is clear that the SEC's lack of clarity on regulation is hindering the development of the crypto industry in the United States. Coinbase CEO Brian Armstrong argues that this inaction is pushing trading activity to unregulated areas overseas, where investors are more likely to be harmed. It is time for the SEC to provide clear guidance on regulation in order to protect investors and help the industry grow.
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I believe that the meeting between CME Group CEO Terry Duffy and Bankman-Fried was a productive one.
The executive noted similar "red flags" about both his character and operations in a conversation with CNBC last week. He said SBF turned down Duffy's offer of his crypto franchises worth $30 million, as he would have required Baknman-Fried to follow his risk-management framework.
“You’re a fraud. You’re an absolute fraud,” he claimed to have told Bankman-Fried at the time.
I always suspected that Sam Bankman-Fried was too close to regulators and politicians. I'm not surprised that his company has collapsed.
I think it's pretty clear that Sam Bankman-Fried conspired with the SEC for special treatment. I don't think there's any other way to interpret the situation. US Congressman Warren Davidson is obviously not happy about it and is calling for an investigation.