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US Congressman Tom Emmer Says FTX’s Collapse Wasn’t a Crypto Fail but a Fail With SEC Chairman Gary Gensler former FTX CEO Sam Bankman-Fried and centralized finance. “We have to get to the bottom of it. We need to understand why Gary Gensler and the SEC were not doing their job,” the lawmaker pointed out.
Rep Emmer Says FTX Fallout Isn’t a Crypto Failure
US Congressman Tom Emmer (R-MN) said on Tuesday that the implosion of cryptocurrency exchange FTX is not a crypto failure. Instead, he said it was a flop with central finance (left), Securities and Exchange Commission (SEC) Chairman Gary Gensler, and former FTX CEO Sam Bankman-Fried.
The lawmaker tweeted:
The FTX collapse is not a crypto failure. It’s a failure with cefi, Gary Gensler and Sam Bankman-Fried. Decentralization is the point.
In an interview with Fox Business on Tuesday, Emmer further described FTX’s collapse as a failure of “business ethics”, “government oversight”, and “regulatory procedures”.
He then cited benchmark reports that the SEC met with Bankman-Fried in March and worked to give FTX special treatment. The lawmaker has confirmed that his office is looking into the matter.
Emmer added that Bankman-Fried also pushed for “special treatment legislation through Congress.” However, when the former FTX CEO’s proposal finally came to light, the crypto industry immediately raised several red flags. The legislator pointed out:
It’s a failure, it seems, on Gary Gensler’s part to deal with the bad guys.
The congressman pointed out that Gensler was never there to deal with Celsius Network and Voyager Digital when they had to file for bankruptcy earlier this year, just like he wasn’t there to deal with FTX. Nor was he there to deal with terra/luna when the cryptocurrency crashed in May, Emmer said.
Dealing with bad actors” is exactly what it [Gensler] is supposed to do,” the congressman exclaimed, noting:
What is the regulator responsible for doing, prosecuting good actors in the community and making behind-the-scenes deals, it seems, with people who are doing nefarious things.
“We have to get to the bottom of it. We need to understand why Gary Gensler and the SEC weren’t doing their job,” Congressman Emmer pointed out. “We need to understand how it got to the point where people and their economies are hurting. This is exactly what the regulator is supposed to take care of.
The lawmaker noted that regulators were going after decentralized finance (defi). “That’s not what this is about,” he warned, concluding:
It’s not about the crypto industry. This is Sam Bankman-Fried. These are the regulator, Gary Gensler, and centralized finance, which must be placed under a regulatory umbrella. Gary Gensler did nothing to make that happen.
Emmer is not alone in warning against centralized finance. Ethereum co-founder Vitalik Buterin also said that “anything centralized is suspect by default.” Investment firm Paradigm co-founder Matt Huang explained, “FTX’s problems are precisely those that decentralized finance can solve through increased transparency and security.” Additionally, Shark Tank star and NBA Dallas Mavericks owner Mark Cuban said recent failures by crypto companies are not crypto-specific.
The Minnesota congressman has repeatedly criticized Gensler for his approach to regulation. In June, he criticized the securities watchdog for failing to regulate in good faith, saying that “under Gensler’s chairmanship, the SEC has become a power-hungry regulator.”
