Efforts are in motion to resurrect the crypto exchange FTX, previously led by the convicted Sam Bankman-Fried. In a bankruptcy auction, three contenders, including a company headed by former New York Stock Exchange President Tom Farley, are contending to acquire the remaining assets of the defunct exchange. Gary Gensler, Chairman of the Securities and Exchange Commission (SEC), has expressed openness to the revival of FTX, with the condition that the new leadership adheres to U.S. laws and upholds investor trust.
FTX's native token, FTT, has experienced a significant surge, surging by an impressive 76.4% in the last 24 hours. This rally follows the anticipation of FTX 2.0, reignited by Gensler's statements. As per CoinGecko, FTT is currently trading at $2.20, a level not witnessed since mid-April.
While FTX, once one of the largest crypto exchanges, faced a collapse in November of the previous year due to shocking revelations about its balance sheet, it now has the chance for a comeback. The auction winner, set for the proposed exit from bankruptcy in 2024, can potentially rejuvenate the exchange.
Gary Gensler advised the potential new owner of the FTX brand, emphasizing the need to build trust among investors. He stressed the importance of proper disclosures and avoiding commingling functions, trading against customers, or utilizing their crypto assets for personal gain.
Despite FTX and its sister company Alameda Research starting as separate entities, evidence from Bankman-Fried's trial indicated blurred divisions between the two. Funds from FTX flowed into Alameda Research, addressing the trading giant's substantial loan obligations and supporting trades.
Gary Gensler, highlighting the prevalence of bad actors in the crypto market, emphasized the necessity of further protective measures for consumers. He pointed out the challenge of numerous global players operating without adherence to established regulations, emphasizing the need for compliance with international sanctions and anti-money laundering laws.
In response to Gensler's regulatory approach, Representative Tom Emmer introduced an amendment at the Capitol, aiming to curtail what he perceives as a pattern of regulatory abuse that stifles American innovation and capital formation.
