In Manhattan, federal prosecutors are said to have met with FTX's new CEO and lawyers to figure out what went wrong with the company's losses.
Reports said authorities were also investigating whether FTX used customer funds for trading. FTX creator Sam Bankman-Fried was also accused of depegging TerraUSD (UST) earlier in 2022.
New CEO and lawyers amid the confusion surrounding the company's losses.
According to sources, federal prosecutors in Manhattan looking into the FTX collapse met with the new CEO of FTX, John Ray, and bankruptcy attorneys. Prosecutors are also investigating into claims that FTX lost billions of dollars or misappropriated consumer payments. The US SEC is also looking into claims that FTX US misappropriated user monies in a separate probe. According to reports, the meeting happened on Thursday in New York.
According to reports, authorities were also investigating whether FTX misused customer funds for trading. This is in addition to a different accusation that the depegging of TerraUSD (UST) earlier in 2022 was caused by FTX creator Sam Bankman-Fried.
The government inquiry, according to The New York Times, is centred on determining if FTX influenced the markets for two cryptocurrency tokens, TerraUSD and LUNA. According to the article, SBF is the subject of a larger investigation concerning possible market manipulation. According to earlier accounts, Sam Bankman-Fried and Genesis were to blame for the Terra disaster according to Terra co-founder Do Kwon. Before the UST depeg, Genesis allegedly gave SBF $1 billion in TerraUSD (UST) stablecoin, according to Kwon.
According to the story, which cited sources, federal prosecutors have been attempting to gather information from investors connected to FTX over the past few weeks. Details of any communications with anyone from the cryptocurrency exchange were sought by the authorities. It's possible that this is an effort to compile written proof of Sam Bankman-involvement. Fried's Legal professionals think it will only be a matter of time before the prosecutors have enough evidence to arrest SBF.
John Deaton, an attorney for XRP, recently asserted that there is ample justification for SBF's imprisonment. He continued by saying that the theft-like offence committed by the cryptocurrency exchange.
