The chairman of the Commodity Futures Trading Commission (CFTC) has revealed that he and his workforce met with Sam Bankman-Fried and different FTX executives 10 instances earlier than the crypto alternate filed for chapter. The regulator sees the FTX collapse as “a classic run based on liquidity crunch.”
CFTC’s Meetings With FTX and Sam Bankman-Fried
The chairman of the Commodity Futures Trading Commission (CFTC), Rostin Behnam, shared particulars of his company’s conferences with executives of collapsed crypto alternate FTX earlier than the Senate Committee on Agriculture, Nutrition, and Forestry on Thursday.
Behnam advised senators that he and quite a lot of high-level CFTC officers met with former FTX CEO Sam Bankman-Fried (SBF) 10 instances over the previous 14 months. The conferences have been centered round FTX’s application to amend the clearinghouse license for Ledgerx, a CFTC-regulated entity that FTX purchased final year. FTX and about 130 affiliated corporations filed for chapter on Nov. 11 and Bankman-Fried stepped down because the CEO. Ledgerx was excluded from the chapter submitting.
The CFTC chairman mentioned:
My workforce and I met with Mr. Bankman-Fried and his workforce. Over the previous 14 months, we met 10 instances within the CFTC office at their request — all in relation to this clearinghouse application.
Nine conferences have been in Washington, D.C., and one was at a convention in Florida, the CFTC chairman famous. He additional clarified that there have been additionally cellphone calls, textual content messages, and emails exchanged between CFTC officers and FTX regarding the crypto alternate’s “dogged desire to get this application approved.”
The CFTC chief emphasised: “My approach to the application given the issues and the strong feelings was that I needed it to be transparent and open with him and FTX … so there were a number of emails and messages back and forth all about the application and the status of the application.”
While Behnam didn’t recall what number of instances Bankman-Fried or different FTX executives met with CFTC workers, he mentioned that “they were in the building quite a bit” to debate the small print of their clearinghouse application.
The CFTC chairman added: “There were very, very strong feelings about this application. And I felt I needed to be engaged as the chairman of the agency that met directly with FTX and Mr. Bankman-Fried.”
Commenting on the FTX collapse, Behnam mentioned: “It seems like a classic liquidity crunch.” He concluded:
It appears like a traditional run primarily based on liquidity crunch.
At the time FTX filed for chapter, the CFTC was nonetheless reviewing its application and Behnam mentioned no determination had been made.
Bankman-Fried additionally met with officers on the U.S. Securities and Exchange Commission (SEC) a number of instances earlier than FTX filed for chapter.
What do you consider the CFTC meeting with Bankman-Fried 10 instances earlier than the alternate filed for chapter? Let us know within the feedback part under.
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