The Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) are investigating FTX.
Bitcoin exchange The Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) are conducting an investigation into FTX’s misuse of client cash and the firm’s interactions with FTX. The United States and Alameda Research.
The SEC and CFTC’s probe arises from the recent FTX liquidity crisis, which triggered a widespread contagion throughout the cryptocurrency markets.
Bloomberg originally reported that the SEC started investigating FTX US’s crypto lending activities and operations months ago, citing unidentified sources.
Bloomberg says that the CTFC is collaborating with the SEC to investigate FTX in addition to FTX.US and the links between the two exchanges and the trading company Alameda.
The FTX liquidity problem has prompted concerns and calls for further regulation and control over which agency should regulate trading platforms such as FTX.
Typically, the CTFC has limited its regulation of crypto markets to derivatives, but this might change if it suspects fraud or manipulation. The SEC, on the other hand, regulates any token that is security – another area that has lacked control and guidelines, raising worries about Bitcoin and Ethereum’s status according to the SEC’s Howie test. Currently, regulators monitor crypto investing businesses.
This past week, authorities sought information on FTX.US and FTX’s ownership structure. Both regulatory agencies are aggressively hunting for overlaps in management and executive boards. According to Bloomberg, they are also investigating any financial relationships between the two different exchanges.
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