When Sam Bankman-Fried faces a House panel on Tuesday to explain how his crypto lending company FTX unraveled, he may expect a familiar line of questioning around his companies’ finances and accounting protocols.
Lawmakers may press Bankman-Fried on public documents and his own recent statements to the media — such as saying he didn’t “knowingly commingle” FTX funds with Alameda Research — which could offer fertile ground for inquiry. An early filing by FTX’s current CEO, John J. Ray III, in Delaware bankruptcy court referred to “missing or stolen” assets, and to the company outsourcing its accounting.
The high-profile hearing may offer a window into the kind of rules that lawmakers think the industry should be subject to, attorneys told Insider. The FTX fallout also comes during the so-called crypto winter, a time when other major players like Celsius and Voyager have filed for bankruptcy as customers scramble for recoveries in an unregulated industry.
“What we’re starting to see is very inexperienced people leading companies with very little oversight and management,” said Greg Rinckey, a former federal prosecutor in Norfolk, Virginia, and partner at the law firm Tully Rinckey PLLC. “Congress is going to be interested in, ‘Should there be regulation?'”