According to a former prosecutor for the US Justice Department’s Securities and Commodities Fraud branch, the arrest of former FTX CEO Sam Bankman-Fried (SBF) has offered US government regulators with a means to “send a message” to the crypto industry.
According to Renato Mariotti of CoinDesk TV’s “First Mover,” Bankman-publicity Fried’s tour following the crypto exchange’s bankruptcy may have contributed to his downfall. SBF was arrested in the Bahamas on Monday after the US charged him with wire fraud, conspiracy to commit money laundering, and campaign finance crimes, among other things.
“From the DOJ’s standpoint, SBF was spreading misinformation and instilling doubt in the authorities’ ability to control the market,” he said of Bankman-spate Fried’s of media appearances.
Mariotti, who is now a partner at international law firm Bryan Cave Leighton Paisner, adding that there was “speculation that authorities were going to let him free” without facing punishment, in part because of his political contacts to lawmakers. SBF had given more than $40 million to various political campaigns, including $5.2 million to Joe Biden’s successful U.S. presidential candidacy in 2020.
However, with the fall of FTX, Bankman-Fried, who is facing eight criminal accusations, has “certainly” tarnished crypto’s reputation. “There’s obviously an energy in federal law enforcement right now in going after crypto,” Mariotti said.
Mariotti believes Bankman-Fried will be presented as an example of why the digital asset business requires stronger regulation. He believes that there will be no crypto-friendly regulations in the near future. Instead, he predicted that the business would face “a lot of enforcement proceedings” in the near future, particularly from the Securities and Exchange Commission (SEC).
“The [Biden] government feels that the digital asset industry is uncontrolled and that [crypto businesses] may do whatever they want,” Mariotti added. Because of this, federal regulators are “ready to plant a flag and send a message.”
Author: Crypto Tech News 24