According to reports, there were several meetings between the US Securities and Exchange Commission (SEC) and Sam Bankman-Fried, the former CEO of the now-bankrupt FTX exchange.
The meetings had occurred before the exchange filed for bankruptcy and rumors indicate that Gary Gensler, the SEC chairman, may have assisted the founder of FTX with legal loopholes.
But, there is another report that highlights a contradicting viewpoint.
After the FTX crypto exchange filed for bankruptcy, there have been rumors flying around that accuse Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), of helping the exchange.
It has been alleged that Gensler assisted the former CEO of FTX, Sam Bankman-Fried, with legal loopholes that allowed him to establish a regulatory monopoly.
As a matter of fact, there is also speculation that a no-action letter would have been issued to FTX by the SEC boss.
In fact, the chairman’s calendar shows that he had a meeting with Bankman-Fried back in March this year.
A meeting note from the SEC states that members of Gensler’s staff had a meeting with the staff of FTX and IEX for discussing custody of digital asset securities by broker-dealers.
It further said that the discussion had also covered the risks associated with the custody as well as the no-action relief.
However, Charles Gasparino of Fox Business shared different details on Saturday. He tweeted that contrary to speculation, Gensler had not been about to grant a regulatory monopoly to SBF.
He said that the meeting in March between the two sides had mostly been a lecture from Gensler that lasted 45 minutes and was essentially about what he expected from a crypto exchange.
Gasparino said that these details had been shared by a personal who attended the meeting. The SEC chief had not made any promises to IEX, FTX, or Bankman-Fried.
Instead, the journalist said that Gensler had asked them to provide more details about their model to the SEC by way of disclosure.
He said that there had been follow-up meetings after that up until FTX collapsed, but none of them were about the SEC giving approval.
He added that hearings would likely be held by House GOP about FTX, given that Bankman-Fried was Dem inclined, but they may have to think twice before they call Gensler as a witness.
According to sources, Gensler had informed Bankman-Fried and Brad Katsuyama that he wanted strict standards and oversight and approval was not guaranteed.
Nonetheless, there is a great deal of speculation of social media that FTX was receiving assistance from the SEC. Some suspect that it could be because SBF made huge donations to the Democratic Party.
According to political donor data, the former chief of FTX was the second-largest donor in 2021-2022 after George Soros, as he donated $39.8 million to the Democrats.
Congressman Tom Emmer said that they were looking into the allegations that were made against the SEC chief.
Gensler himself said that he had clarified in the meetings that non-compliance was not acceptable as the public would suffer.