Regulation

FTX’s Sam Bankman-Fried and Brett Harrison Respond to FDIC’s Allegations of ‘False Statements’

Prime executives at crypto trade large FTX are responding to allegations of deceptive statements from the Federal Deposit Insurance coverage Company (FDIC).

FTX CEO Sam Bankman-Fried tells his 761,000 Twitter followers the crypto trade platform just isn’t FDIC-insured and that solely the banks they work with are.

On Thursday, the FDIC issued a cease-and-desist order to the crypto trade, saying that they have been deceptive prospects into believing the merchandise they provide have been FDIC-insured.

Bankman-Fried additionally notes that he’s not in opposition to working with the FDIC to insure deposits sooner or later.

“Clear communication is actually necessary; sorry! FTX doesn’t have FDIC insurance coverage (and we’ve by no means stated so on web site and so forth.); banks we work with do. We by no means meant in any other case, and apologize if anybody misinterpreted it.

We’re additionally excited to discover potential ways in which particular person accounts utilizing direct deposit (which we now assist) might, sooner or later, be used to additional defend prospects, and could be excited to work with the FDIC on that, however to be clear FTX US isn’t FDIC insured.”

FTX.US president Brett Harrison says that his earlier statements that have been below hearth from the FDIC weren’t meant to mislead buyers. He additionally says he’s complying with the FDIC’s order to delete the tweets.

“We actually didn’t imply to mislead anybody, and we didn’t recommend that FTX US itself, or that crypto/non-fiat belongings, profit from FDIC insurance coverage. I hope this gives readability on our intentions. Completely happy to work straight with the FDIC on these necessary matters.

Per the FDIC’s instruction I deleted the tweet. The tweet was written in response to questions raised on Twitter relating to whether or not direct USD deposits from employers have been held at insured banks (i.e. Evolve Financial institution).”

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