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Global Banking Regulation Review: Regulators Brace for FTX FalloutNovember 15, 2022
The US Commodity Futures Trading Commission has been criticized for its lack of strict regulation across the cryptocurrency landscape following the crash of FTX, the world’s second-largest crypto exchange. FTX filed for Chapter 11 protection in Delaware last week, resulting in regulators, market participants, and legislators anticipating rigorous regulatory action to be taken as a result. William Pao, a FinTech partner at O’Melveny, noted that regulators will be “emboldened” by the debacle. “Be prepared for some very aggressive tactics,” Pao said. “Regulators will be active as never before. They will investigate FTX, Sam Bankman-Fried and everything he has touched.” Daniel Shamah, co-head of O’Melveny’s Bankruptcy Litigation Group, called the company’s collapse a “naked, freefall bankruptcy,” and said to “expect this to be a long, expensive process that will take years to play out.”
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