The investigations by the Securities and Exchange Commission and the Commodity Futures Trading Commission relate to the liquidity crisis at the trading platform that led to a planned buyout of its non-US operations by rival exchange Binance Holdings Ltd., according to the people. Regulators are also looking into the platform’s relationship with FTX.com’s American counterpart FTX US and Bankman-Fried’s trading house Alameda Research. The SEC’s inquiry began months ago as a probe into FTX US and its crypto-lending activities, said two of the people, who asked not to be identified because the investigations haven’t been publicly disclosed.
A representative for the SEC declined to comment and the CFTC didn’t immediately respond to a request. A representative for Binance declined to comment. A representative for FTX US and FTX.com didn’t immediately respond to requests for comment.
Binance Chief Executive Officer Changpeng Zhao stunned the crypto world on Tuesday with an announcement that his firm was moving to take over rival FTX.com, which was suffering a liquidity crunch. Since the announcement questions have swirled around the deal, and Binance may not follow through with it because of concerns raised during the due diligence process.
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