BlockNews
FOLLOW ON X
  • BITCOIN
  • CRYPTO
    • ETHEREUM
    • RIPPLE XRP
    • SOLANA
    • CARDANO
    • BINANCE BNB
    • DOGECOIN
    • TRON
    • SUI
    • CHAINLINK
    • LITECOIN
  • FINANCE
  • POLITICS
  • MEMECOINS
  • NFT
  • OPINION
No Result
View All Result
BlockNews
  • BITCOIN
  • CRYPTO
    • ETHEREUM
    • RIPPLE XRP
    • SOLANA
    • CARDANO
    • BINANCE BNB
    • DOGECOIN
    • TRON
    • SUI
    • CHAINLINK
    • LITECOIN
  • FINANCE
  • POLITICS
  • MEMECOINS
  • NFT
  • OPINION
No Result
View All Result
BlockNews
Home BUSINESS

Crypto Exchanges Questioned for Consumer Protection after FTX Catastrophe

BlockNews Team by BlockNews Team
December 2, 2022
in BUSINESS, CRYPTO, MEDIA
Reading Time: 3 mins read
1
SHARES
15
VIEWS
Share on XShare in TelegramShare on Reddit

Following FTX’s liquidity problems and recent bankruptcy, United States Senate Finance Committee Chair Ron Wyden has reached out to six cryptocurrency firms for information on consumer safety.

Wyden sent letters to the top crypto exchanges: Coinbase, Binance, Gemini, Kraken, KuCoin, and Bitfinex. On November 28, he asked about their preparedness and backup plans for a meltdown similar to FTX’s. The senator claimed that FTX customers lacked the same “protections” afforded to customers of traditional financial institutions like central banks and registered brokers by the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation.

He tweeted, “Consumers who entrusted their assets to firms like FTX are discovering they have no protections when companies go bust. As Congress considers much-needed regulations for the crypto industry, I am laser-focused on ensuring real consumer protections.”

The American lawmaker requested the six mentioned crypto companies to provide transparent answers to questions such as the safety of consumer assets, defense against market manipulation, user data of customers, and subsidiary companies that may tamper the stability of the exchanges.

They must provide an answer to Wyden by December 12.

Authorities On FTX

Similarly, on December 13, the House Financial Services Committee will hold an investigational hearing into FTX. Maxine Waters, the committee’s chair, and Patrick McHenry, the ranking member, have both expressed support for the legislative action. McHenry has described the events surrounding the unsuccessful exchange as a “dumpster fire.”

Bankruptcy proceedings for FTX have recently begun in the District of Delaware, where it has been revealed that the exchange may owe more than a million creditors. The bankruptcy case’s next scheduled hearing is on December 16.

Previously, a couple of Democratic members of the US Senate asked the Department of Justice to investigate FTX and any involved individuals that have caused its collapse. Attorneys Merrick Garland, Kenneth Polite, Senators Sheldon Whitehouse, and Elizabeth Warren asked the DOJ to prosecute all incompetent personnel that has affected all the customers in the exchange.

All fingers point directly to former CEO Sam Bankman-Fried after his deleted tweet that said all the funds in the exchange were “fine” and created alibis regarding the liquidity controversy of FTX.

The DOJ has yet to investigate Bankman-Fried and the now-crumbled crypto exchange. Still, financial regulators all over the globe have begun their findings on FTX, especially in the Bahamas, where his company resided.

Crypto Exchange CEOs Regarding the Aftermath

Following the downfall of FTX, Coinbase CEO Brian Armstrong and Binance CEO Changpeng “CZ” Zhao had their statements.

Armstrong may have shown a neutral ground on Bankman-Fried, but after the bankruptcy, he said that the former CEO might have had ties with fraud and other malicious business practices. He also noted that the SEC is partly to blame for the bankruptcy due to its ongoing prosecution of the crypto industry.

Meanwhile, CZ, who declined Bankman-Fried’s call for help to buy out FTX, played a vital role before the rivaling crypto exchange’s collapse. He called out on Fried regarding the liquidity of his company which led to rising fears in the crypto community, especially the users under FTX. When the CoinDesk news came out along with CZ’s accusations, it ultimately broke Sam Bankman-Fried’s company. Now, CZ claims he wants to “rebuild” crypto by establishing a recovery fund to help struggling crypto projects in case of liquidity crises.

Disclaimer: BlockNews provides independent reporting on crypto, blockchain, and digital finance. All content is for informational purposes only and does not constitute financial advice. Readers should do their own research before making investment decisions. Some articles may use AI tools to assist in drafting, but every piece is reviewed and edited by our editorial team of experienced crypto writers and analysts before publication.
Tags: cryptoCrypto ExchangeFTXSBF
TweetShareShare
BlockNews Team

BlockNews Team

DON'T MISS THESE! HOT OFF THE PRESS

Here is What Aave’s CEO Just Revealed About the Q4 2025 Upgrade
CRYPTO

Here is What Aave’s CEO Just Revealed About the Q4 2025 Upgrade

September 17, 2025
How to Go From Zero to Your First Profitable Trade in Crypto (2025)
BITCOIN

How to Go From Zero to Your First Profitable Trade in Crypto (2025)

September 17, 2025
What Happened in Crypto Today? – September 17: Fed Interest Rate Decision, Bullish DOGE and LINK News
CHAINLINK

What Happened in Crypto Today? – September 17: Fed Interest Rate Decision, Bullish DOGE and LINK News

September 17, 2025
What is Arbitrum? Why ARB is an Underpriced Crypto Gem Hiding in Plain Sight
CRYPTO

What is Arbitrum? Why ARB is an Underpriced Crypto Gem Hiding in Plain Sight

September 17, 2025
Here is Why Experts Predict a 40X Rally for Pepe Coin After $25M Whale Outflow
CRYPTO

Here is Why Experts Predict a 40X Rally for Pepe Coin After $25M Whale Outflow

September 17, 2025
Here is Why SUI Could Soar 200% on Google Cloud Partnership and ETF Buzz
CRYPTO

Here is Why SUI Could Soar 200% on Google Cloud Partnership and ETF Buzz

September 17, 2025
Load More

Related News

Coinbase Teams Up with Ethereum Foundation on Open Intents Framework

Coinbase Teams Up with Ethereum Foundation on Open Intents Framework

September 18, 2025
Here is What Aave’s CEO Just Revealed About the Q4 2025 Upgrade

Here is What Aave’s CEO Just Revealed About the Q4 2025 Upgrade

September 17, 2025
How to Go From Zero to Your First Profitable Trade in Crypto (2025)

How to Go From Zero to Your First Profitable Trade in Crypto (2025)

September 17, 2025
What Happened in Crypto Today? – September 17: Fed Interest Rate Decision, Bullish DOGE and LINK News

What Happened in Crypto Today? – September 17: Fed Interest Rate Decision, Bullish DOGE and LINK News

September 17, 2025
Jerome Powell October Rate Decision Outlook: What to Expect and How it Will Effect You

Jerome Powell October Rate Decision Outlook: What to Expect and How it Will Effect You

September 17, 2025
Twitter Telegram Threads

BLOCKNEWS.COM

BlockNews is your premier source for real-time cryptocurrency, blockchain, political and financial market news.

Stay ahead of the herd with BlockNews

RESOURCES

  • About Us
  • Contact Us
  • Editorial Policies
  • Terms and Conditions
  • Privacy Policy
  • Sitemap

DISCLOSURES AND POLICIES

BlockNews provides independent reporting on crypto, blockchain, and digital finance. Content is for informational purposes only and does not constitute financial advice. Sponsored material is always disclosed. By using this site, you agree to our Terms and Conditions and Privacy Policy.

© 2025 BlockNews

No Result
View All Result
  • HOME
  • BITCOIN
  • CRYPTO
    • ETHEREUM
    • RIPPLE XRP
    • SOLANA
    • CARDANO
    • BINANCE BNB
    • DOGECOIN
    • TRON
    • LITECOIN
    • CHAINLINK
    • SUI
  • MEMECOINS
  • POLITICS
  • FINANCE
  • NFT
  • DEFI
  • GUIDES

© 2025 BlockNews