Few days ago, the global cryptocurrency/web3 space was shocked by an announcement from Binance exchange to acquire a rival exchange, FTX. Although Binance is one of the biggest crypto exchanges in the world, acquiring/merging with FTX was an unexpected dream.
During the past few months, Binance and FTX have acquired/merged with different struggling companies in the crypto space. The two crypto exchanges have been strong competitors and rivals to each other, which made the acquisition announcement surreal to crypto users.
On the 10th of November, FTX suddenly banned the withdrawal of funds and assets (a precursor to many a crypto collapse). A few hours later, Binance CEO, Zhao Changpeng, announced the acquisition of FTX. The purchase was a bail-out to help the collapsing exchange, which had collapsed, and investors/customers were withdrawing their funds.
SEC And CFTC Set To Investigate FTX Fund/Asset Management
The United States crypto and virtual assets regulatory bodies, SEC and CFTC, have announced a probe to investigate the management of customers’ funds and assets.
According to Bloomberg, the United States Security and Exchange Commission is investigating if customers’ assets or funds were mishandled. Also, all affiliated companies with FTX, including Alameda Research, will be probed.
The Commodity Future Trade Commission stated that the collapse of FTX has called for more strict regulation of the crypto market, especially during market liquidity. FTX native token (FTT) crashed in the markets, and over $3 billion was lost, after which Binance called off the acquisition deal with FTX.
Need For More Regulations In The U.S. Crypto Markets
Following the crash of FTX, there has been a demand for more strict regulation of the United States crypto markets. The market liquidity and FTX crisis have triggered the attention of crypto regulators and the community for a more regulated space.
Also, popular anti-crypto Lawmakers, Senator Elizabeth Warren, called for regulating the “smoke and mirror” crypto space in the United States. Taking to her verified Twitter handle, Elizabeth urged the SEC to aggressively regulate the web3 space to safeguard innocent customers’ and users’ interests.
Soon, the SEC will release the outcome of its investigation alongside the Commodity Future Trade Commission. Although, there are rumors that the SEC has been investigating the activities of FTX exchange in the United States for the past few months. The SEC has been probing its crypto-lending activities and the activities of affiliated Alameda Research companies.