The U.S. Securities and Exchange Commission (SEC) reportedly met with crypto exchange FTX and former CEO Sam Bankman-Fried several times before the crypto firm filed for bankruptcy. SEC Chairman Gary Gensler was rumored to be helping FTX with legal loopholes. However, a new report indicates a contradicting viewpoint.
Gensler’s Meeting With Sam Bankman-Fried and FTX
Following the bankruptcy filing of cryptocurrency exchange FTX, rumors have surfaced accusing the chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, of helping former FTX CEO Sam Bankman-Fried and his bankrupt exchange with “legal loopholes to obtain regulatory monopoly.” Some people have even speculated that the SEC boss was about to issue FTX a no-action letter.
Gensler’s own calendar shows that he did meet with Bankman-Fried in March. According to an SEC meeting note, “members of the staff of Chair Gensler met with staff of IEX and FTX to discuss custody of digital asset securities by special purpose broker-dealers, including the unique risks associated with custody of digital asset securities and the conditional no-action relief discussed in the statement.”
However, Fox Business’ Charles Gasparino explained on Twitter Saturday that “Contrary to speculation” about Gensler looking to grant former FTX CEO Sam Bankman-Fried a regulatory monopoly on a crypto exchange:
March meeting between the two sides was described by a person attending as ’45 minute lecture by Gensler’ on what he wants from a crypto exchange.
Not only did the SEC chairman make no promises to Bankman-Fried, FTX, and IEX, but he also “ordered them to provide much more in the way of disclosure etc to the SEC about their model,” the journalist noted.
“Follow-up meetings with the SEC continued up to nearly the time FTX imploded but no SEC approval was signaled,” he continued. “House GOP likely to hold hearings on FTX given Bankman-Fried’s Dem political leanings by calling Gensler as a witness might have to think twice. Sources say Gensler told Brad Katsuyama & Bankman-Fried he wanted strict oversight, standards & there was no guarantee of approval.”
Nonetheless, many people have expressed on social media their belief that either Gensler or other SEC staff members were helping FTX. Some suspected that it was because Bankman-Fried is a big donor to the Democratic Party. The former FTX chief was the second largest donor to the Democrats in 2021-22, donating $39.8…
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