California regulators to investigate collapse of FTX crypto exchange
The Department of Financial Protection and Innovation (DFPI) in the state of California announced on November 10 that it will open an investigation into the “apparent failure” of cryptocurrency exchange FTX.
California regulators said in the announcement that DFPI takes this oversight responsibility “very seriously” and that the department expects all entities that provide financial services in the state to comply with local financial laws.
It also urged anyone in the state who has been affected by the events of the ongoing FTX saga to call a dedicated hotline.
The state of California is one of many state actors in the US that have recently spoken out on the matter, despite FTX claiming that its US branch is not involved in the incidents.
Sam Bankman-Fried, the founder of FTX, tweeted a 22-tweet thread in which he reiterated several times that FTX US is a different entity than the international one facing the turmoil.
19) A few other assorted comments:
This was about FTX International. FTX US, the US-based exchange that accepts Americans, was not financially affected by this shitshow.
It is 100% liquid. Each user can withdraw in full (modulo gas charges, etc.).
Updates on the future to come.
— SBF (@SBF_FTX) 10 November 2022
However, later on November 10, FTX US announced that it may halt trading on the platform in the coming days. Currently on the US website it says “withdrawals are and will remain open.”
Related: FTX turmoil increases scrutiny of the industry, something institutional investors have been waiting for
event as a mechanism to demand more regulation of the crypto industry.
On November 10, Maxine Waters, the chair of the US House of Representatives Financial Services Committee, called for tighter industry regulations, highlighting that FTX tokens are “worthless” and that customers are in the dark.
The same day saw White House press secretary Karine Jean-Pierre issue a statement saying the administration will “closely monitor” activity in the crypto space. Moreover, the “recent news” underscores the need for “proper regulation” of cryptocurrencies.
US Senators Debbie Stabenow and John Boozman reiterated their commitment to finalize and publish an upcoming crypto bill in light of the news, also citing the incident.
While all this was going on, FTX US withdrew from the Crypto Council for Innovation.
