Skip to content Skip to sidebar Skip to footer

Nov 17 (Reuters) – New FTX CEO John Ray says there was faulty regulatory oversight and a lack of corporate oversight over the bankrupt crypto exchange founded by Sam Bankman-Fried in a filing filed Thursday in a US court.

In the most publicized crypto explosion to date, FTX filed for protection in the United States on Friday after traders withdrew $6 billion from the platform in three days and rival exchange Binance dropped a bailout deal.

“Never in my career have I seen such a complete failure of corporate controls and such a complete absence of reliable financial reporting as has occurred here,” Ray said in the filing, which was filed with of the District of Delaware Bankruptcy Court.

“From the compromised integrity of systems and faulty regulatory oversight overseas, to the concentration of control in the hands of a very small group of inexperienced, unsophisticated and potentially compromised individuals, this situation is unprecedented.” , added Ray to the record.

Bankruptcy expert Ray, who took over from Bankman-Fried as CEO when FTX filed for protection on Friday, did not name any specific foreign regulator in that part of the 30-page filing.

FTX founder Bankman-Fried did not immediately respond to a request for comment on the allegations in the filing.

In the filing, Ray also alleged that Bankman-Fried made “erratic and misleading public statements,” citing an exchange with a reporter on Twitter.

Vox on Wednesday posted an interview with Bankman-Fried in which he said he regretted his decision to file for bankruptcy and criticized regulators.

He then tried to put out the fire, saying the basis of the interview was an exchange of messages that was not meant to be public.

Bankman-Fried said he grew his business too quickly and didn’t notice any signs of trouble on the stock market, according to The New York Times. reported earlier this week.

“If I had been a little more focused on what I was doing, I could have been more thorough,” Bankman-Fried said in a newspaper interview.


As the effects of FTX’s collapse reverberated around the world, Singapore state investor Temasek Holdings, an FTX investor, also referenced Bankman-Fried in a detailed statement on Thursday, as it said he would write the value of his entire investment of $275 million.

“It is apparent from this investment that perhaps our belief in the actions, judgment and leadership of Sam Bankman-Fried … would appear to have been misplaced,” Temasek said.

Other investors, including Softbank Group’s Corp’s (9984.T) vision fund and Sequoia Capital have also writing reduce their investments in the stock exchange to zero, as the repercussions of the FTX bankruptcy continue to reverberate around the world.

Crypto major player Genesis Global Capital on Wednesday suspended client buyouts in its lending business, in response to “the extreme market dislocation and loss of industry confidence caused by the implosion of FTX”.

Financial and market authorities around the world reacted to FTX’s failure by Singapore finance minister stating on Thursday that his collapse raised “very serious allegations which amount to potential fraud”.

Whereas Indonesia ordered crypto exchanges to stop trading FTX tokens, Brazil’s Crypto Advocates refer to the implosion of FTX as they urge lawmakers to give final approval to a bill to strengthen oversight of the cryptocurrency industry.

Reporting by Niket Nishant in Bengaluru, additional reporting by Alun John in London and Hannah Lang in Washington; Editing by Shinjini Ganguli, Anil D’Silva and Alexander Smith

Our standards: The Thomson Reuters Trust Principles.

Source link

Leave a comment