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If Celsius deposits are determined to belong to customers, users are far more likely to get their assets returned. Crypto companies typically offer a variety of accounts and they will likely be treated differently in bankruptcy. BlockFi, which is at the beginning of its own bankruptcy case, also offers both interest-bearing and custody accounts. 'WORSE THAN BANKS'Courts will also have to look beyond the user agreements and examine how crypto companies actually handled the deposits, according to bankruptcy specialists. “This is going to have enormous influence on crypto companies and crypto customer behavior."

☆ Lawyers for FTX customers accuse debtors of failing to file full financial disclosures
▼ + stars: | 2022-12-07 | by ( Pete Syme | ) www.businessinsider.com time to read: +3 min

Lawyers at Eversheds Sutherland represent FTX's non-US customers – 98% of its 1.2 million users. The lawyers say that Chapter 11 debtors should file full financial disclosures. The law firm Eversheds Sutherland represents the Ad Hoc Committee of Non-US Customers of FTX.com, established to protect users outside the US. Erin Broderick, an attorney at Evershed Sutherland, said "Chapter 11 debtors are typically required to file full financial disclosures shortly after the bankruptcy filing." Adam Landis, the lawyer representing FTX and its entities, did not immediately respond to Insider's request for comment.

☆ SBF's Alameda racked up $55,000 Margaritaville debt by snapping up around 20 premium suites for workers, who took bus across tropical island to work, report says
▼ + stars: | 2022-12-07 | by ( Pete Syme | ) www.businessinsider.com time to read: +3 min

Insider earlier reported how Sam Bankman-Fried's Alameda owed $55,319 to Margaritaville. Employees told Bloomberg that the company used around 20 premium suites for Alameda staff. Staff at the 4-star hotel told Bloomberg that employees of FTX entities stayed there for several months this year, and were generally friendly. Employees told Bloomberg that the company had around 20 suites in One Particular Harbour – a high-end building designed for longer stays, next to the main resort. One resort employee told Bloomberg that they had plans to go out on the town with friends from FTX, but never had the chance after the firm went bankrupt.

☆ Cryptocurrency firms need to 'come into compliance' with existing rules, SEC Chair Gary Gensler says
▼ + stars: | 2022-12-07 | by ( Chelsey Cox | ) www.cnbc.com time to read: +3 min

Gensler told Yahoo Finance in an interview that the SEC has brought more than 100 enforcement cases in the crypto space, directly challenging lawmakers' questions about the agency's oversight. "We're already suited up," Gensler told Yahoo Finance. The SEC chief said cryptocurrency firms should be held liable for compliance with existing rules. Gensler told Yahoo Finance that the SEC has successfully deterred other suspicious crypto firm activities. Gensler said the SEC would take more enforcement actions if cryptocurrency exchanges will not comply, but he did not elaborate on what those would be.

☆ SEC chief Gary Gensler says crypto platforms need to 'come into compliance' or face the regulator's wrath
▼ + stars: | 2022-12-07 | by ( Morgan Chittum | ) www.businessinsider.com time to read: +2 min

SEC chair Gary Gensler says the agency has "enough authority" for a crypto regulatory crackdown. Gensler's comments come a month after the demise of once-$32 billion crypto exchange FTX. The regulator has "enough authority" for a crackdown in the space, Gensler said, adding that the SEC is "already suited up." Crypto exchange Coinbase faced legal threats from the regulator for its lending offering as well, leading it to scrap the effort. Gensler's comments come after the demise of FTX, the once-$32 billion crypto exchange started by Sam Bankman-Fried.

Three people close to FTX and Bankman-Fried told CNBC that the former CEO lobbied aggressively for a partnership with 11-time Grammy Award winner Taylor Swift. Bankman-Fried's commitment to getting the Swift deal done despite the deteriorating business environment fit a pattern of ignoring his lieutenants and going it alone, a half-dozen former company insiders and business partners said. The Financial Times reported earlier that FTX held talks with Swift about a potential sponsorship. Part of the Swift deal would have included the production by the singer of a collection of non-fungible tokens (NFTs), or digital items that can rise and fall in value. Beyond that, there was a lack of clarity over what Swift would be doing for the company, sources said.

☆ Crypto winners and losers from the FTX fallout, according to Bernstein
▼ + stars: | 2022-12-07 | by ( Tanaya Macheel | ) www.cnbc.com time to read: +2 min

Bernstein has sifted through the various sectors of the crypto industry and identified winners and losers for 2022. Crypto suffered the added handicap of the financial contagion from the collapse of Terra in the first half of the year and FTX currently. Binance, which operates in a regulatory gray zone, will eventually become the "global consolidator" of smaller off-shore exchanges, Bernstein said. While FTX taught investors about the risks of storing crypto holdings with centralized entities, revelations in the stablecoin sector went the other way around. Solana, on the other hand, took a hit, stained by the fallout of FTX, a big and early backer of Solana.

☆ House Financial Services Chair Waters doesn't plan to subpoena Sam Bankman-Fried to testify at hearing on FTX collapse
▼ + stars: | 2022-12-07 | by ( Brian Schwartz | ) www.cnbc.com time to read: +3 min

House Financial Services Committee Chairwoman Maxine Waters told Democrats she doesn't plan to subpoena former FTX CEO Sam Bankman-Fried to testify at Tuesday's hearing about the crypto exchange's rapid demise, according to people with direct knowledge of the conversation. Those at the meeting say Waters said she wants committee staff try to convince Bankman-Fried to voluntarily testify, those with knowledge of the meeting said. As of late Wednesday, Bankman-Fried has yet to agree to voluntarily testify to the House committee, two of the people explained. Waters invited Bankman-Fried to voluntarily testify before the panel and could always change her mind and subpoena him before Tuesday. John Jay Ray III, the new FTX CEO, is scheduled to testify at next week's House hearing.

☆ Lawmakers Want Answers From Silvergate About FTX Transfers
▼ + stars: | 2022-12-06 | by ( David Benoit | ) www.wsj.com time to read: 1 min

Lawmakers are demanding information from Silvergate Capital Corp. about transfers of customer funds between Sam Bankman-Fried ‘s collapsed trading firm, Alameda Research, and his cryptocurrency exchange, FTX. In a letter to the bank Monday, Republican Sens. John Kennedy of Louisiana and Roger Marshall of Kansas, along with Democratic Sen. Elizabeth Warren of Massachusetts, said an Alameda depository account at Silvergate “appears to be at the center” of the transfer of FTX customer funds to the trading firm. Failure to detect this “scheme,” the senators said, could mean the bank broke anti-money-laundering laws.

☆ Sen. Warren demands answers from Silvergate Bank about its business dealings with FTX
▼ + stars: | 2022-12-06 | by ( Gretchen Morgenson | Gretchen Morgenson Is The Senior Financial Reporter For The Nbc News Investigative Unit. A Former Stockbroker | She Won The Pulitzer Prize In For Her | ) www.nbcnews.com time to read: +13 min

“Life as a crypto firm can be divided up into before Silvergate and after Silvergate,” Bankman-Fried gushed in a testimonial featured recently, and prominently, on Silvergate Bank’s website. But in a conversation with an investment manager, a former top FTX employee said Silvergate was FTX’s primary banking partner. As a regulated bank, Silvergate has a duty to monitor clients’ accounts for suspicious activities that could signal fraud, money laundering or tax evasion, the filings note. FTX frequently used the Silvergate Exchange Network, according to the former FTX employee with direct knowledge of the transactions. A Silvergate spokeswoman said the change reflected a shift in functions taken on by a new president at the bank.

[1/2] The logo of FTX is seen at the entrance of the FTX Arena in Miami, Florida, U.S., November 12, 2022. Ellison, who ran trading firm Alameda Research, has hired Washington-based law firm Wilmer Cutler Pickering Hale and Dorr to represent her, a source familiar with the matter told Reuters. Semafor previously reported Mills' advisory work for Bankman-Fried. FTX secretly transferred customer funds to its affiliate Alameda Research to fill a shortfall at the crypto trading firm, Reuters has previously reported. The Wall Street Journal has previously reported that Ellison and senior FTX officials knew the crypto exchange had dipped into its customer funds to help Alameda meet liabilities.

☆ Silvergate shares fall despite CEO letter seeking to diffuse concerns over FTX fallout
▼ + stars: | 2022-12-06 | by ( Tanaya Macheel | ) www.cnbc.com time to read: +1 min

Bitcoin and ether ended Thursday in the red, but ether has surged more than 100% since mid-June. Silvergate Capital fell Tuesday, even after the company's CEO released a public letter attempting to "set the record straight" about its role and current state in the crypto ecosystem. Shares were last lower by 6% after falling as much as 13% in premarket trading. Speculation has been swirling around the crypto friendly bank in the wake of the FTX blowup, as investors try to decipher Silvergate's relationship with FTX and potential impact from it. Silvergate recently disclosed that FTX deposits at the bank represent less than 10% of its total deposits from crypto customers.

☆ Former FTX engineer quietly became multimillion-dollar Democratic donor after new role at cryptocurrency exchange
▼ + stars: | 2022-12-06 | by ( Brian Schwartz | ) www.cnbc.com time to read: +2 min

Former FTX CEO Sam Bankman-Fried wasn't the only company executive who put big money behind campaigns aligned with the Democratic Party. Singh donated $8 million to federal campaigns in the 2022 election cycle, and all of it went to Democrats, according to the nonpartisan OpenSecrets. He was among a handful of former senior officials at FTX who were deeply involved with financing the 2022 midterms. Two years later, Singh donated $1 million to Future Forward USA, a PAC that backed President Joe Biden's 2020 run for president, records show. Singh, who was among the FTX leaders initially fired after the company collapsed, did not return repeated requests for comment.

☆ Sam Bankman-Fried's venture unit reportedly invested in a military drone maker, fertility clinic, and a vertical farming company. Here are some of the defunct crypto giant's biggest and most bizarre b
▼ + stars: | 2022-12-06 | by ( Morgan Chittum | ) www.businessinsider.com time to read: +3 min

Sam Bankman-Fried's venture unit placed bets on a military drone maker, a fertility clinic, and a vertical farming company, the FT reported. Alameda Research's private equity portfolio reportedly had over 500 investments. Screenshots of an Excel spreadsheet detail the firm's wide array of investments. The spreadsheet indicates investments in military drone maker BRINC and fertility startup Ivy Natal for $1.5 million. Neither companies immediately responded to Insider's request for comment or listed any Sam Bankman-Fried's investment entities as backers on their websites.

☆ FTX's Bankman-Fried hires white collar defense attorney Mark Cohen
▼ + stars: | 2022-12-06 | by ( Chris Prentice | ) www.reuters.com time to read: +3 min

Bankman-Fried has retained Cohen, of Cohen & Gresser, Bankman-Fried's spokesperson Mark Botnick said in an emailed statement. In recent weeks, U.S. authorities have sought information from investors and potential investors in FTX, according to two sources with knowledge of the requests. Federal prosecutors in New York are asking for details on any communications such firms have had with the crypto firm and its executives, including Bankman-Fried, the sources said. The Securities and Exchange Commission has been asking for similar information from investors as well, one of the sources said. "I didn't ever try to commit fraud," Bankman-Fried said, adding that he doesn't personally think he has any criminal liability.

When crypto exchange FTX was struggling to raise cash early last month, it seized billions of dollars worth of collateral from its trading arm, Alameda Research, and used it to try to convince investors of its financial health, former FTX Chief Executive Sam Bankman-Fried said. But much of it didn’t add up. A big chunk of the assets consisted of four thinly traded crypto tokens closely connected to Mr. Bankman-Fried and FTX employees and mostly held by Alameda. The tokens were likely worth far less than the $6.4 billion marked on the balance sheet FTX was shopping to investors in the hope of a bailout, according to market data and crypto researchers.

☆ More Crypto Exchanges Verify Reserves, But Questions About Assets Remain
▼ + stars: | 2022-12-05 | by ( Mark Maurer | ) www.wsj.com time to read: +7 min

Most crypto exchanges are privately held, meaning they don’t have to file financial statements with the Securities and Exchange Commission or get them audited. He added that customers of crypto exchanges should “look for as rigorous of that as you can look for regulatory reporting.”FTX founder Sam Bankman-Fried sat down with The Wall Street Journal to discuss what happened to the billions of dollars deposited by the exchange’s customers. Photo: Kenny Wassus/The Wall Street JournalSuch a third-party verification represents a step toward more transparency around crypto exchanges, but there are significant shortcomings, some academics said. Coinbase Global Inc. last month reported $95.11 billion in both customer crypto assets and liabilities for the quarter ended Sept. 30, up from $88.45 billion the previous quarter, filings show. Still, the PCAOB encourages investors to review reports on the work those companies’ auditors have done, Chair Erica Williams said at a conference Tuesday.

☆ Bankman-Fried says he will testify before U.S. House committee
▼ + stars: | 2022-12-05 | by ( ) www.reuters.com time to read: +1 min

Dec 4 (Reuters) - FTX founder Sam Bankman-Fried tweeted on Sunday that he would testify before the House Financial Services Committee after he finished "learning and reviewing" the events that led to the spectacular collapse of his cryptocurrency exchange. The U.S. House Financial Services Committee plans to hold a hearing in December to investigate the collapse of FTX and expects to hear from the companies and individuals involved, including founder and CEO Bankman-Fried. Committee Chair Maxine Waters last week invited Bankman-Fried to participate in the panel's hearing on Dec. 13.loading"Once I have finished learning and reviewing what happened, I would feel like it was my duty to appear before the committee and explain," the founder and former FTX CEO wrote in a reply to Waters. Bankman-Fried added that he was unsure if that would happen before Dec. 13.loadingHe rejected suggestions of fraud in a range of interviews last week after his company's collapse stunned investors and left creditors facing losses totaling billions of dollars. Reporting by Akriti Sharma in Bengaluru; Editing by Stephen CoatesOur Standards: The Thomson Reuters Trust Principles.

☆ Sam Bankman-Fried vows to testify before House Committee on Financial Services over FTX collapse when he's 'finished learning and reviewing what happened'
▼ + stars: | 2022-12-05 | by ( Beatrice Nolan | ) www.businessinsider.com time to read: +2 min

Sam Bankman-Fried says he'll testify when he's finished "learning and reviewing what happened." Bankman-Fried addressed his tweet to Rep. Maxine Waters and the US House Committee on Financial Services. Waters had previously invited Bankman-Fried to participate in a hearing on December 13. In a tweet addressed to US Rep. Maxine Waters and the House Committee on Financial Services, the disgraced crypto boss said on Sunday: "Once I have finished learning and reviewing what happened, I would feel like it was my duty to appear before the committee and explain. Representatives for FTX did not immediately respond to Insider's request for comment made outside of normal working hours.

Bankman-Fried could face a host of potential charges – civil and criminal – as well as private lawsuits from millions of FTX creditors, legal experts told CNBC. There are three different, possibly simultaneous legal threats that Bankman-Fried faces in the United States alone, Levin told CNBC. He told CNBC, "prosecutors would have to prove beyond a reasonable doubt that Bankman-Fried or his associates committed criminal fraud." (Carter was not an FTX investor, and told CNBC that his fund passed on early FTX rounds.) "People should not jump to the conclusion that something is not happening just because it has not been publicly disclosed," Levin told CNBC.

☆ FTX Founder Sam Bankman-Fried Says He Can’t Account for Billions Sent to Alameda
▼ + stars: | 2022-12-04 | by ( Alexander Osipovich | ) www.wsj.com time to read: 1 min

NASSAU, Bahamas—FTX founder Sam Bankman-Fried said he couldn’t explain what happened to billions of dollars that customers of his failed cryptocurrency exchange sent to the bank accounts of his trading firm, Alameda Research. And he said he couldn’t rule out the possibility that money deposited by FTX customers who were told their money was theirs alone was in fact lent to Alameda.

☆ Anna Sorokin says Sam Bankman-Fried's media apology tour is a scam: 'He's just trying to save himself'
▼ + stars: | 2022-12-04 | by ( Jacob Shamsian | ) www.businessinsider.com time to read: +6 min

Sam Bankman-Fried has been on a media apology tour following the collapse of his crypto firm. Convicted scammer Anna Sorokin (AKA Anna Delvey) thinks "he's just trying to save himself." 'He's just looking for pity'Through his media interviews, Bankman-Fried is trying to cultivate a more innocent image in the public eye, Sorokin speculated. Sorokin acknowledged that Bankman-Fried's narrative that he was blindsided, rather than willfully preying on FTX's customers, may be legitimate. "I don't know which one is worse — that he actually was not in control, or if he's trying to cover it up now.

The answer is simple, according to more than a dozen Washington insiders, FTX employees, and crypto industry observers who spoke with Insider. I don't think anyone believed that he was going to fund candidates who were, quote unquote, committed to ending pandemics who were also hostile to the crypto industry." Alex Wong/Getty ImagesRebuffed by the SEC, Bankman-Fried turned his attention to Congress. "It's not that he was welcoming regulation," says the senior figure in the crypto industry who attended meetings with Bankman-Fried. But while Bankman-Fried was busy wooing Washington, FTX was about to become Exhibit A in the case for more effective oversight of the crypto industry.

☆ Elon Musk speaks out on 'Twitter Files' release about platform inner workings
▼ + stars: | 2022-12-04 | by ( Ramishah Maruf | ) edition.cnn.com time to read: +2 min

During a two-hour long Twitter Spaces session, Musk said a second “Twitter Files” drop will again involve Taibbi, along with journalist Bari Weiss, but did not give an exact date for when that would be released. It showed employees on several Twitter teams debating over whether to restrict the article under the company’s hacked materials policy, weeks before the 2020 election. Musk also said Twitter should program and monetize native long audio and video posting. He is quoted as saying that some of the investment may have been sold before Twitter went private in October, but he wasn’t sure. Musk also said that Twitter will roll out its new account verifications within the next week, which had been halted.

☆ The unraveling of $3 billion crypto lender BlockFi amid FTX's 'death spiral', according to bankruptcy filings
▼ + stars: | 2022-12-03 | by ( Morgan Chittum | ) www.businessinsider.com time to read: +5 min

The crypto platform owes $30 million to the SEC, per bankruptcy filings. FTX, which once offered BlockFi a $400 million credit line, ultimately led to the firm's bankruptcy. BlockFi cited significant exposure to Sam Bankman-Fried's crypto empire, which filed for bankruptcy on November 11. Ironically, once FTX's "death spiral" began, BlockFi's liquidity crisis ensued and the company paused user account withdrawals on its platform. Due to the loan agreement and $355 million in digital assets held on FTX, BlockFi had substantial exposure.

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