Rostin Behnam, chairman of the Commodity Futures Buying and selling Fee (CFTC), throughout a Senate Agriculture, Diet and Forestry Committee listening to in Washington, D.C., U.S., on Wednesday, Feb. 9, 2022.
Sarah Silbiger | Bloomberg | Getty Photos
WASHINGTON — The founder and former CEO of failed cryptocurrency change Sam Bankman-Fried met with high-level officers on the Commodity Futures Buying and selling Fee greater than 10 occasions over the previous 14 months, together with with CFTC Chairman Rostin Behnam.
Behnam testified Thursday earlier than the Senate Committee on Agriculture, Diet, and Forestry, which oversees the nation’s commodities markets. The CFTC head informed senators that the conferences with Bankman-Fried centered round FTX’s “dogged” want to amend the clearinghouse license for LedgerX LLC, which FTX purchased in 2021 and is overseen by the CFTC.
The modification, which was filed about 12 months in the past, would have allowed LedgerX to instantly settle crypto derivatives with out the involvement of intermediaries. The proposed change was nonetheless pending approval by the point FTX filed for chapter earlier this month.
“My workforce and I met with Mr. Bankman-Fried and his workforce. Over the previous 14 months, we met 10 occasions within the CFTC workplace at their request all in relation to this (derivatives clearing group); this clearinghouse software,” Behnam informed committee chair Sen. Debbie Stabenow, D-Mich.
In his opening statements, Behnam stated LedgerX has been registered with the CFTC since 2017 and was one of many few FTX entities that did not file for chapter together with FTX final month.
Bankman-Fried stepped down as FTX CEO and the corporate filed for Chapter 11 chapter final month.
“The CFTC has been in near-daily contact with LedgerX in addition to the third-party custodians it makes use of to carry money and digital belongings,” Behnam stated. “Based mostly on the knowledge introduced to us, at the moment, LedgerX buyer property stays safe and LedgerX has the monetary sources to proceed working for the foreseeable future.”
Behnam stated most of his conferences with Bankman-Fried and the FTX workforce happened in Washington, however there was additionally a gathering at a convention in Florida, two telephone calls and numerous messages aimed toward transferring the applying alongside.
Later within the listening to, Behnam informed Sen. Tommy Tuberville, R-Ala., that emails have been additionally exchanged between the events.
“A few of the messages have been about scheduling the ten conferences I discussed,” Behnam stated. “Nevertheless it was about updates, giving us, once more, this dogged strategy to ‘we submitted solutions to the questions from the division or we now have extra knowledge to simply help their advocacy of this software,’ all in relation to the applying.”
The CFTC chair stated he did not know what number of occasions Bankman-Fried or FTX executives met with different employees on the company, however he stated they have been within the constructing “fairly a bit” to debate the main points of the clearinghouse software.
“I decided very early to be as clear as doable with the method,” Behnam stated. “There have been very, very sturdy emotions about this software. And I felt I wanted to be engaged because the chairman of the company that met instantly with FTX and Mr. Bankman-Fried.”
The fee was reviewing FTX’s software on the time it filed for chapter. Behnam stated there had been no resolution as of Nov. 11, when FTX introduced its chapter.