Three U.S. Senators have sent a letter to Silvergate bank about its role in the collapse of the FTX cryptocurrency exchange.
A core issue in the FTX collapse was FTX didn’t have its own bank account in the early days, so customers sent funds to related party Alameda, which should have been handed on to FTX. But instead, there was just an inter-company ledger entry. The figure for these transfers was said by former CEO Sam Bankman-Fried to be between $5 billion and $8 billion in various statements.
“Your bank’s involvement in the transfer of FTX customer funds to Alameda reveals what appears to be an egregious failure of your bank’s responsibility to monitor for and report suspicious financial activity carried out by its clients. The public is owed a full accounting of the financial activities that may have led to the loss of billions in customer assets, and any role that Silvergate may have played in these losses,” wrote Senators Warren (Democrat), Marshall (Republican) and Kennedy (Republican).
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