The Securities and Exchange Commission [SEC] has intensified its efforts to regulate the crypto market, targeting prominent players such as Binance and Coinbase. Amidst this regulatory crackdown, FTX found itself drawn into the situation as various members of the crypto community raised concerns about its activities.
In a recent interview with Bloomberg, SEC Chair Gary Gensler reminded the community about the FTX controversy. He further brought the issue back to the forefront of discussion. He said,
“There’s a business model that bundles and commingles functions that we don’t see, nor would we allow elsewhere, in finance.”
Following the charges of commingling user funds against Binance, SEC Chair Gary Gensler made the statement about the FTX controversy, emphasizing the regulatory concerns surrounding the crypto industry. He called out “platforms” and “entrepreneurs” in the process. He added,
“Platform after platform, entrepreneurs […] are trying to build wealth for themselves and their investors through sister organizations, hedge funds, trading against the customers.”
Amidst these comments and notions, the community yearns to know why FTX was spared.
Crypto community questions SEC about FTX
The question of “Why hasn’t the SEC taken legal action against FTX?” is frequently being raised on crypto Twitter. This has even attracted the attention of CZ, the CEO of Binance, who is currently experiencing regulatory backlash.
They didn't sue FTX. https://t.co/FVgi5l6VcI— CZ 🔶 Binance (@cz_binance) June 6, 2023
“Why didn’t the SEC sue FTX? Oh that’s right they allowed public servants to take donations and colluded with them to further oppress Americans”
Ripple’s CEO Brad Garlinghouse went a step ahead. He noted how the SEC was trying to “distract” the community from the FTX mishap.
If it wasn’t already clear, it should be now – Chair Gensler’s laughable “pro-innovation” stance (as he said today), is exactly the opposite. What this also tells me is that the SEC is throwing lawsuits at the wall and hoping they distract from the agency’s FTX debacle.— Brad Garlinghouse (@bgarlinghouse) June 6, 2023
As the community eagerly awaits responses from the SEC, Binance and Coinbase are actively seeking solutions. Meanwhile, other notable exchanges are maintaining a watchful stance. Some are considering the possibility of discontinuing support for assets that fall under the category of securities in the SEC lawsuit.