In a few hours in Washington, the same Congress which had questioned the leaders of the GAFA or the heavyweights of Wall Street in the GameStop affair will open a new hearing entitled “Crypto Crash: Why the FTX Bubble Burst and the Harm to Consumers”.
As the main interlocutor, Sam Bankman-Fried, the former CEO of the FTX cryptocurrency exchange platform, which imploded last month. At his expense, 32 billion dollars evaporated overnight and tens of thousands of creditors unable to find their funds.
It had taken days before he finally agreed to talk. In relative freedom, hidden in his properties in the Bahamas, Sam Bankman-Fried was reluctant to appear and take an oath on the Bible, as required by the American investiture process. Today, his participation is more than likely as the man was arrested last night at the request of US authorities. He should most certainly be extradited to the United States without delay. The hearing could therefore take place in physical presence, to shed light on the crypto case with the most serious consequences to date for individuals and professionals alike.
Questions to ask Sam Bankman-Fried
Unless the hearing is postponed, this would be an opportunity for committee members to ask their questions as to how FTX client funds were misappropriated, how clients were prevented from withdrawing their own money, and how the second largest cryptocurrency exchange platform was able to let his boss was able to place his clients’ funds without anyone having a problem with it and how was he able to recover part of it for his personal projects.
To protect and defend himself, Sam Bankman-Fried has found an effective weapon. On several occasions, he explained that he was unable to answer all the questions “I still do not have access to a large part of my data, professional or personal”, he tweeted. On the program, the new CEO of FTX since its bankruptcy, John J. Ray III will also be present to answer questions, he who knows a lot more than anyone thanks to his access to company files.
“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of reliable financial information as has happened here”, he began by saying the day he arrived at the head of FTX, the day of its bankruptcy, on November 17. He will be one of the most important respondents in the case.
Questions to ask John J. Ray III
John J. Ray III, after 40 years of legal and restructuring experience, is expected to shed light on the transfer of funds from FTX to Alameda Research, the links between FTX and the Bahamian authorities, and the various transfers unauthorized money made from FTX on the day of the bankruptcy. On November 17, several large transactions were carried out for a total of $372 million transferred. Of these, $24 million was sent to the Jane Street Company in a withdrawal that has never been explained.
FTX’s new CEO will also be quizzed on what he knows about Sam Bankman-Fried’s Democratic Party fundraising campaigns, as well as whether FTX customers in the US will ever be able to get their accounts back and their funds.
FTX’s US subsidiary, which was in theory completely independent, was among the companies that went down the day the cryptocurrency platform implosed. Since October, she has also been the subject of her own investigation by the Texas authorities. The latter considered that FTX us offered unregulated products. A hearing is scheduled for February 2.