Deposit Insurance Corporation (FDIC) months before the collapse of the largest US crypto exchange, which was also a customer of FTX. The emails show that FTX CEO Sam Bankman-Fried and FDIC officials met in April 2021 to discuss a potential partnership. The FDIC reportedly expressed interest in using FTX’s technology to create a digital asset platform for its member banks.
The emails also reveal that Bankman-Fried provided the FDIC officials with a tour of FTX’s headquarters in Hong Kong and discussed potential use cases for FTX’s technology. The FDIC officials were reportedly impressed with FTX’s technology and expressed interest in pursuing a partnership.
However, just a few months later, FTX’s largest US customer, Binance.US, collapsed due to regulatory pressure. The collapse reportedly cost FTX over $150 million in losses, and led to a series of lawsuits and regulatory investigations.
The emails have raised questions about whether FTX was aware of Binance.US’s regulatory issues and whether it took appropriate measures to protect itself from potential losses. FTX has not publicly commented on the emails or the allegations.
The FDIC has also not commented on the emails, but a spokesperson told The Block that the agency is “committed to exploring innovative approaches to the supervision of digital assets and other emerging technologies.”
The news comes as US regulators are cracking down on cryptocurrency exchanges and other crypto-related businesses. The Securities and Exchange Commission (SEC) has filed several lawsuits against cryptocurrency companies in recent months, and the Commodity Futures Trading Commission (CFTC) has reportedly launched an investigation into Binance’s US operations.
The FDIC, which is responsible for insuring bank deposits, has also been exploring the use of digital assets and blockchain technology. In July, the agency issued a request for information (RFI) seeking input on how it can use blockchain and other emerging technologies to improve its operations. The FDIC has also not commented on the emails, but a spokesperson told The Block that the agency is “committed to exploring innovative approaches to the supervision of digital assets and other emerging technologies.”
The release of the emails is likely to fuel further scrutiny of FTX and other cryptocurrency exchanges, as regulators continue to grapple with the fast-evolving crypto industry. As the use of cryptocurrencies becomes more widespread, regulators are under increasing pressure to ensure that businesses in the space are operating safely and transparently.