- Gensler suggested FTX could relaunch ethically under new ownership, prompting FTT to surge 84% as investors gained optimism about FTX’s potential revival.
- Evidence showed FTX founder Sam Bankman-Fried secretly lent customer funds and deceived investors, leading to fraud convictions in his federal trial.
- Bankruptcy lawyer John Ray III believes over 90% of lost FTX customer assets can be returned within a year if a settlement plan is approved, making bidders hopeful to take over FTX operations when it exits bankruptcy in 2024.
U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler recently made comments indicating the possibility of reviving the collapsed cryptocurrency exchange FTX. This news prompted a significant price surge for FTX’s native token, FTT.
Gensler Hints at FTX Relaunch
During his talk at DC Fintech Week on Wednesday, Gensler referred to former New York Stock Exchange President Tom Farley’s bid to acquire FTX. He suggested that if Farley or anyone else wanted to relaunch FTX, they should do so legally and ethically.
Specifically, Gensler said new FTX owners should not comingle customer funds, trade against customers, or use their crypto assets improperly. Following these comments, FTT jumped 84% as investors gained optimism about FTX’s potential revival.
The Fall of FTX and Sam Bankman-Fried
Gensler’s remarks come on the heels of FTX founder Sam Bankman-Fried being convicted on all counts in his federal fraud trial last week. Evidence showed Bankman-Fried secretly lent FTX customer funds to his trading firm Alameda Research and deceived investors.
Now, bankruptcy lawyer John Ray III is tasked with recovering funds for FTX creditors. He believes over 90% of lost customer assets can be returned if a settlement plan is approved within the next year.
Meanwhile, bidders like Farley’s Bullish exchange hope to take over FTX operations when it exits bankruptcy in 2024. Despite Bankman-Fried’s conviction, Gensler’s comments suggest regulators remain open to a relaunch under ethical leadership. For now, the possibility of FTX rising from the ashes has renewed investor enthusiasm.