Crypto exchanges Binance and FTX had been at odds, with one allegedly pushing the other out of business. Investor and Shark Tank star Kevin O’Leary testified before the U.S. House Committee on Financial Services.
“This is my opinion; I have no evidence. … Binance has now become an unregulated global monopoly,” he said.
O’Leary may have been referring to Binance CEO Changpeng Zhao’s statement to get rid of FTT. Utility tokens together with BUSD totalled around $2.1 billion as a result of the company’s exit from its portfolio investment in FTX.
Zhao’s initiative worsened the problems at Sam Bankman-Fried’s exchange. It filed for bankruptcy in November.
O’Leary and Cato Institute research director Jennifer Schulp, another witness, spoke up in defence of cryptocurrencies overall. They noted that users’ trouble stems from the lack of proper regulation of industry participants.
Senate Banking Committee member Pat Toomey stressed that a blanket ban on digital assets would not solve the problems that led to the FTX collapse.
In the Bankman-Fried platform, the problem lay in misallocation of client funds, gross abuses and probably illegal conduct. Some proposed somehow stopping the spread of crypto until legislation is enacted. This is a deeply flawed and unworkable idea. If we do not pursue a draconian, authoritarian policy, digital assets cannot be banned.
Earlier, Senators Elizabeth Warren and Roger W. Marshall introduced a bill tightening anti-money-laundering measures involving cryptocurrencies.
FTX’s new CEO John J. Ray III accused Sam Bankman-Fried and his team of storing private keys without encryption. In their actions he saw “old-fashioned waste” rather than sophisticated, meticulously planned crimes.
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