February 4, 2023

Two congressional hearings will be held next week on the collapse of cryptocurrency exchange FTX and US lawmakers have asked former FTX CEO Sam Bankman-Fried (SBF) to testify. As the founder of FTX and Alameda Research, “you must account for the failure of both entities that was caused, at least in part, by the obvious misuse of client funds and the wiping out of billions of dollars owed to more than a million creditors,” Senator Sherrod Brown told Bankman-Fried.

2 congressional hearings on FTX set for next week

The House Committee on Financial Services and the Senate Committee on Banking, Housing and Urban Affairs will separately hold a hearing next week on the collapse of crypto exchange FTX.

U.S. Senator Sherrod Brown (D-Ohio), chairman of the Committee on Banking, Housing, and Urban Affairs, sent a letter Wednesday to former FTX CEO Sam Bankman-Fried (SBF) asking him to attend his committee’s hearing. live titled “Crypto Crash: Why the FTX Bubble Burst and the Harm to Consumers” that will take place on December 14. The letter reads:

As founder and CEO of FTX Trading Ltd. at the time of the collapse and the founder, principal owner and former CEO of Alameda Research, you must answer for the failures of both entities caused, at least in part, by the apparent misuse of client funds and the wiping out of billions of dollars owed to more than a million creditors.

“There are still significant unanswered questions about how customer money was embezzled, how customers were blocked from withdrawing their own money, and how you orchestrated a cover,” the senator continued.

Brown explained that “Traditionally, witnesses who are invited to appear before the committee make themselves available voluntarily.” He asked Bankman-Fried to respond to his staff at 5 p.m. EST on Thursday to discuss his participation in the hearing.

The legislator warned:

If you choose not to appear, I am prepared, along with rank member Pat Toomey, to issue a subpoena to compel your testimony.

FTX filed for bankruptcy on November 11 and Bankman-Fried stepped down as CEO. The company is now under investigation for mishandling customer money. FTX’s new CEO, John Ray, told the bankruptcy court: “Never in my career have I seen such a complete failure of corporate controls and such a complete absence of reliable financial information as here.”

Meanwhile, Representative Maxine Waters, chair of the House Committee on Financial Services, has invited Bankman-Fried to attend her committee’s Dec. 13 hearing. She has tweeted several times to the FTX co-founder, but has not subpoenaed him to testify.

The congresswoman has been heavily criticized for her polite approach to inviting Bankman-Fried. She even tweeted that she appreciated him being candid in his discussions about what happened to FTX. Waters tweeted on Wednesday:

Lies are circulating @CNBC that I am not willing to subpoena @SBF_FTX. He has been asked to testify at the December 13 hearing. A subpoena is definitely on the table. Stay tuned.

Bankman-Fried told Waters last week that he will testify when he is “finished learning and reviewing what happened,” which he doesn’t expect on Dec. 13.

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Do you think US lawmakers can allow Sam Bankman-Fried to testify at congressional hearings next week? Let us know in the comments below.

Kevin Helms

Austrian economics student Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests are in Bitcoin security, open source systems, network effects and the intersection between economics and cryptography.

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