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The House Financial Services Committee will hold a hearing on Tuesday morning into the bankruptcy of cryptocurrency exchange FTX following the arrest of founder Sam Bankman-Fried in the Bahamas on Monday night. there is
The Justice Department and Bahamian authorities said Bankman-Fried, who had previously planned to testify before the panel, was arrested based on a sealed U.S. indictment that was opened shortly after the hearing began. The U.S. Attorney’s Office for the Southern District of New York has indicted the disgraced cryptocurrency executive on eight counts against him: conspiracy to commit wire and securities fraud, personal accusations of securities and wire fraud, money laundering, and conspiracy to circumvent campaign finance regulations.
The company’s new CEO, John J. Ray, is the panel’s sole witness. The Bankman-Fried hedge fund filed for Chapter 11 bankruptcy after it reportedly transferred billions of dollars of his FTX client funds to Alameda Research. .
The Securities and Exchange Commission also indicted a former cryptocurrency “darling” on Tuesday morning for “engaging a scheme to defraud stock investors on FTX trading.”
The Senate Banking Committee also called on Bankman-Fried to testify at Wednesday’s hearing, which he previously declined to attend.
Bankman-Fried donated approximately $40 million to candidates, campaigns and political action committees in the 2022 congressional midterm elections before the company’s bankruptcy. Most of his public donations went to Democrats. Co-CEO of FTX Digital Markets, Ryan Salame, said he also donated $23 million, with the majority of his donation going to the Republican Party.
FTX’s Director of Engineering, Nishad Singh, has donated over $13 million to political campaigns since the 2020 election cycle.
The donation and subsequent meeting meant lobbying by FTX to advocate for a larger cryptocurrency to the people of Capitol Hill.
