FTX Court Drama Continues; Senators Push Crypto Tax Rules; DeFi Safe in EU; Malaysia Approves Fifth Digital Exchange
Summary:
The court case involving FTX and its former CEO Caroline Ellison continued, bringing to light alleged fraudulent activities and misuse of users' funds under the founder Sam Bankman-Fried. The US Senate is pushing for swift implementation of crypto tax reporting rules to prevent significant tax revenue loss. The European Securities and Markets Authority stated that DeFi currently poses no meaningful risk to financial stability across Europe. Furthermore, Malaysia's Securities Commission has granted preliminary approval to Hata as a Recognized Market Operator, making it the country's fifth regulated digital asset exchange.
With all the twists and turns of a primetime drama, last week's FTX courtroom affair featured Sam “SBF” Bankman-Fried’s ex-business partner and girlfriend, Caroline Ellison, shedding light on some startling aspects of SBF's corporate reign. Ellison acknowledged her fraudulent actions while serving as CEO under the leadership of Bankman-Fried at Alameda. Nevertheless, she laid the blame for the misappropriation of FTX user's money firmly at SBF’s feet, suggesting he established the systems which resulted in Alameda harvesting roughly $14 billion from the exchange.
Ellison disclosed that due to bad loans from Alameda, a wave of fear swept across FTX, provoking users to pull their assets. In a bid to stabilize the situation, FTX halted withdrawals, leading to the exchange's demise within days. In response to an employee's inquiry about how FTX plans to reimburse its customers, she said the crypto exchange was gearing up to raise additional capital to plug the deficit.
She also unveiled to the court SBF’s aspirations to contend for the role of the United States’ president, his readiness to “flip a coin and destroy the world,” and his objectives to draw investment from Saudi Crown Prince Mohammed bin Salman. Concurrently, former FTX CTO Gary Wang, who has been testifying in court, confessed to four charges, including conspiracy.
In a bid to prevent a potential $50 billion annual loss in tax revenue, seven US Senators, including Elizabeth Warren and Bernie Sanders, are urging the Treasury Department and the Internal Revenue Service (IRS) to expedite the implementation of tax reporting rules for crypto brokers.
Decentralized finance (DeFi) does not yet pose a considerable threat to Europe's financial stability, according to the European Securities and Markets Authority (ESMA), the European Union's regulatory authority for financial markets. Despite acknowledging the potential benefits of DeFi such as increased financial inclusion and the creation of innovative financial products, its influence currently appears minimal due largely to its limited size and its relative isolation from conventional financial markets.
The Securities Commission Malaysia has granted in-principle approval to local firm Hata to operate as a Recognized Market Operator, making it the fifth regulated digital asset exchange in the country, and the first to receive approval as a digital broker. Hata is expected to launch its services in six to nine months, and will be able to showcase trade orders from other regulated exchanges.
Published At
10/16/2023 8:30:00 PM
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