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The state of Texas is investigating whether a major digital asset exchange and its billionaire founder violated state securities laws.
Since last week, the Texas Securities Commission has been scrutinizing whether FTX offers unregistered securities to residents through yielding cryptocurrency accounts. A summary of the investigation is set out in documents filed on Oct. 14 in the bankruptcy proceedings of cryptocurrency brokerage firm Voyager Digital Holdings, which has FTX as an asset. won Last month’s auction also started in Texas investigating Voyager after imploding in July.
FTX’s investigation also named CEO Sam Bankman Freed, a key supporter of Beto O’Rourke’s Texas gubernatorial campaign. Crypto Billionaires during the latest fundraising period from July 1st to September 29th Top Democrat Donor List With a donation of $1 million.
State Securities Commission Enforcement Director Joe Rotunda, who drafted the filing, told the Texas Tribune that the investigation was not prompted by complaints. I remembered noticing that I started offering products that were favorable to , and wanted to know what the average Texan’s experience was when buying this type of investment.
And while FTX isn’t registered to sell securities in Texas, Rotunda found it easy to participate in the exchange’s yield earning program even after listing an Austin address.
“We want to make sure that everyone who invests money fully discloses all material information and that investor protection mechanisms are in place.
FTX did not immediately respond to Tribune’s request for comment.However In a statement to Bloomberg Newsa company spokesperson said, “We have an active application for a pending license and believe we are fully operational within what we can do in the meantime.”
At the end of Monday, the Rotunda confirmed that the investigation was still ongoing.
Board investigations could take days to years, but he expects this to be on the “shorter side” as officials prioritize cases with ongoing business problems. The regulator also recommends suspending FTX’s $1.4 billion purchase of Voyager’s assets until the exchange can clear an investigation.
Meanwhile, Rotunda stressed that he welcomes the agency to work with FTX to achieve compliance. This means that the exchange must obtain a license to sell securities within the state or find an exemption from registration. He noted that the process draws from a framework developed by Texas regulators. their settlement In February, digital asset lender BlockFi sued over sale of unregistered securities paid $100 million Settle with federal and state regulators. Texas received approximately $1 million from the settlement.
“We want people in Texas to have the opportunity to invest in what they want to invest in. We want to make sure they’re protected, so we’re trying to get companies to be compliant.” is,” said Rotunda. “The whole goal is to protect Texas.”
