The SamBankman Fried cryptocurrency empire FTX Group collapsed from the US $30030 billion "ashes", and the latest progress of the "financial fraud case" in the United States was touched! A person familiar with the matter said that Sam Bankman Fred, founder of the FTX Exchange, was planning to accept the extradition request of the US government because of the huge earthquake in the global currency circle caused by the "thunder explosion". He may be prosecuted in the Manhattan Federal Court on Tuesday.
1、 US $30 billion was wiped out and millions of people lost their lives?
On December 18 local time, a person familiar with the matter said that Sam Bankman Fred, founder of the FTX Exchange, was planning to accept the extradition request of the US government because of the huge earthquake in the global currency circle caused by the "thunder explosion", and he might be prosecuted in the Manhattan Federal Court on Tuesday. Previously, the US prosecutor had proposed eight controls on him, and all the crimes could be sentenced to 115 years' imprisonment. However, the biggest bad news for millions of creditors is that they are almost impossible to recover most of their losses. A large number of FTX assets are either stolen or missing.
After the collapse of FTX Exchange, many insiders pointed out that SBF and FTX would be another major failure in the history of American financial supervision. Among them, Robin Wigglesworth, a financial reporter of the Financial Times and the author of the index fund books (Trillions), even pointed out that officials of the Commodity Futures Trading Commission of the United States and officials FTX are inextricably linked.
According to the 21st Century Business Herald, EU internal policy makers have begun to question whether the cryptocurrency regulatory measures (MiCA) to be introduced soon to prevent similar FTX Crypto Asset Market Regulation Act are strong enough. MiCA put the encryption assets and their markets under the supervision of the European Banking Authority through ESMA on October 10, 2022, and introduced important rules of the encryption industry. The FTX shock wave will not stop in the short term, but the encryption industry will not disappear. The latter does have problems. Once the regulatory framework takes effect, it will be very important to solve these problems.
According to the documents of the Federal Bankruptcy Court of the United States, the debts disclosed by FTX Group in its bankruptcy application amounted to $10 billion to $50 billion, while the new management found only a small part of assets, including cryptocurrency of about $740 million and offline cold wallet cash of about $560 million.
FTX debt may involve more than 1 million creditors, including nearly $3.1 billion owed to the top 50 largest creditors, about $1.45 billion. It is worth mentioning that FTX, headquartered in the Bahamas, is one of the largest trading platforms in the cryptocurrency field. The FTX valuation was as high as $32 billion, which attracted the support of many well-known investment institutions such as Softbank Group and Sequoia Capital. FTX estimates that Bankman Fried, only 30 years old, once had a wealth of 26 billion US dollars (about 181.5 billion yuan), and was known by the industry as "the big man of the currency circle, the genius rich man".
SBF and their parents are well-known professors of Stanford Law School, and they are preparing for the trial of this century. In a series of public speeches, SBF insisted that it was unclear about Alameda Research, let alone deliberately misappropriating customer assets. However, since the prosecution accused the establishment of the FTX Exchange, SBF misappropriated user assets for venture investment, real estate purchase and political donation.
2、 What is the greater highlight of the grand trial in this century?
US futures regulators may not escape this relationship. After the collapse of the FTX Exchange, many insiders pointed out that the fraud amount of SBF and FTX Group was so large that it would be another major failure and indelible stain in the history of American financial supervision.
The FTX incident has lasted for more than a month. With the intervention of supervision, institutional investors revealed this news and the aftereffect continued, and new details and plots were compiled into increasingly updated news and information. Regulators finally caught up with the market timeline and tried to make up for the rules after digesting most of the public information.
According to the 21st Century Business Herald, some senior Democrats urged the Securities and Exchange Commission (SEC) to speed up the regulation of the encryption market after the collapse of FTX. Democratic Senator Elizabeth Warren declared that more active law enforcement was needed, rather than invalid rules that the encryption industry was trying to make for itself. Janet Yellen, US Treasury Secretary, once again called on the government to strengthen the regulation of cryptocurrency, saying that the recent collapse of FTX was a real lesson, indicating that the industry needed more regulation. Changes in Europe will be more specific and obvious, and FTX's ridicule of European regulation will accelerate the adoption of MiCA. At present, the EU is speeding up the breakthrough of MiCA to reach an agreement.
The Commission of the European Parliament passed MiCA on October 10, 2022. The bill was originally planned to hold a plenary meeting in November this year for a final vote, but because the draft needs to be translated into 24 languages, it will eventually be postponed to February 2023. After the MiCA legislation is passed, the European regulator 12 – based on the new rules of the legislation, is expected to take effect in February 2024 for 18 months. Mica has always been considered as the watershed of cryptocurrency regulation, because it represents the efforts to implement standards in the EU, rather than competing with each other.
Yu Jianing, honorary chairman of the Hong Kong Blockchain Association, told the 21st Century Business Herald that according to the new regulations, all stable currencies will be supervised by the European Banking Authority, and the issuer must live in the European Union. For stable monetary items, USDT and USDC must establish sufficient liquidity reserves in the form of 1:1 ratio and partial deposits to meet the redemption requirements in case of large-scale application events. If the size of this stable currency becomes too large, it will also face a daily trading volume of 200 million euros.
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"MiCA is the first detailed law that truly regulates the stability of currency." MiCA clarified the scope of application of laws and regulations, classification of encrypted assets, regulatory authorities and corresponding information reporting system, business restriction system and behavior supervision system, and established a regulatory framework for encrypted assets beyond the existing EU financial laws.
