The state of California through the Department of Financial Protection and Innovation (DFPI) will open an investigation to look into FTX’s apparent failure. The DFPI, as per the statement, is taking its responsibility very seriously and expects all entities that offer financial services in the state to comply with the state’s financial laws. It has also set up a dedicated hotline for those affected by FTX’s collapse.
However, the founder of FTX Sam Bankman-Fried said the crypto exchange’s U.S branch is not involved in the downfall. He reiterated in a tweet that FTX U.S is a different entity than the international one facing the turmoil. SBF said the US-based exchange that accepts Americans was not financially impacted by the shitshow. He emphasized that it’s 100% liquid and every user could fully withdraw funds.
But on November 10, FTX U.S announced it might stop trading on the exchange in the upcoming days. Ryne Miller, the general counsel at FTX U.S, told employees to preserve work-related documents.
Maxine Waters, the chair of the U.S House of Representatives Financial Services Committee, urged for tighter industry regulations and highlighted FTX tokens FTT being worthless. Karine Jean-Pierre, White House press secretary, said the administration is closely monitoring activity in the crypto space.
Moreover, the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) are investigating FTX’s relationship with SBF’s trading firm Alameda Research and FTX U.S. It should be noted that this probe began months ago.