SBF’s ‘house of cards’ is the crypto industry’s problem now: Morning Brief
By The Yahoo finance
Today’s newsletter is by Myles Udland, senior markets editor at Yahoo Finance. Follow him on
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Sam Bankman-Fried, the disgraced founder and former CEO of FTX, has had a bad week.
A bad week that follows a bad month.
Bankman-Fried, known as SBF in the crypto world, was arrested on Monday and charged by three different U.S. authorities — the Department of Justice, the SEC, and the CFTC — on Tuesday.
As alleged in the SEC’s complaint, the offshore crypto exchange SBF claimed to have built was a mirage, or as SEC Chair Gary Gensler said: “A house of cards [built] on a foundation of deception while telling investors that it was one of the safest buildings in crypto.”
During his brief turn as the industry’s star, SBF was a regular presence in D.C. As outlined in the DoJ’s indictment, SBF, as well as “others known and unknown,” allegedly made campaign donations that exceeded federal limits.
The business of FTX, it seems, was mostly about how to create something legitimate out of something that wasn’t.
The crypto industry has wanted to both disrupt the traditional financial world and have new rules made at a rapid clip to cement its standing in that world.
But just as Gensler and others insist crypto regulations are a problem for the crypto industry, so too have this year’s events shown that problems for the crypto industry are not problems for the broader investment world.
Which seems to be the outcome SBF — and most everyone else — wanted to avoid.
