FTX Founder Volunteers To Testify Before House Committee On Crypto Collapse

FTX founder Sam Bankman-Fried said he will testify before the U.S. House Financial Services Committee on Dec. 13 regarding the collapse of the popular cryptocurrency exchange.

Bankman-Fried said in a series of tweets Friday that he would voluntarily testify after Representative Maxine Waters, a chairwoman of the committee, told Reuters she would pursue a subpoena unless he came forward.

Bankman-Fried said on Twitter that he does not have full access to his personal or professional data, limiting what he could say before the committee.

"I won't be as helpful as I'd like. But as the committee still thinks it would be useful, I am willing to testify on the 13th," said in a post.

1) I still do not have access to much of my data -- professional or personal. So there is a limit to what I will be able to say, and I won't be as helpful as I'd like.

But as the committee still thinks it would be useful, I am willing to testify on the 13th. https://t.co/KR34BsNaG1
— SBF (@SBF_FTX) December 9, 2022

FTX filed for bankruptcy after traders pulled $6 billion from the platform in three days, and rival exchange Binance did not commit to a bailout deal to acquire the company.

FTX was one of the most reliable crypto exchanges. However, after an article from CoinDesk revealed that self-issued FTT tokens were being used as collateral for billions in loans for Alameda Research, Bankman-Fried's crypto hedge fund, FTX quickly fell into a liquidity crisis.

Treasury Secretary Janet Yellen said on Wednesday that more effective oversight is needed to address the criminally high risks "at the center of the crypto market stresses observed over the past week." Yellen also urged Congress to act quickly regarding regulation.

Reuters

The new CEO of FTX, John Ray III, appointed on Nov. 11 after its collapse, said the exchange faces unprecedented problems.

"Never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as I occurred here," the executive said.

"From compromised systems integrity and faulty regulatory oversight abroad to the concentration of control in the hands of a very small group of inexperienced, unsophisticated, and potentially compromised individuals, this situation is unprecedented," Ray added.

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