CFTC commissioner has revealed that FTX VCs will be included in a series of serious grilling regarding the ongoing FTX case. The commissioner said that the management at FTX was questionable and raised many eyebrows. Now, the CFTC want’s to unearth what was going on there.

FTX official’s grilling continues

The efforts by US regulators and prosecutors to grill the Executives at the now-bankrupt crypto exchange FTX aren’t slowing down. The CFTC commissioner has revealed that they have been disturbed by several questions regarding how the exchange operated. 

Now, they want to question the VCs to learn more about the exchange’s lack of records, as John Ray III revealed in 2022. John Ray is the current FTX liquidations CEO. In a 2022 US Congress hearing, John Ray made several bold reveals surrounding the findings of his liquidations team.

One of the major issues was that FTX did not have record-keeping whatsoever. The exchange also had an auditor not yet heard of, which raised many eyebrows. Amid the ongoing investigations against Bankman-Fried, the CFTC questions how venture capitalists (VCs) operate in crypto.

CFTC Commissioner questions the role of crypto VCs

In an interview with Bloomberg, the CFTC Commissioner Christy Goldsmith Romero said he needs help figuring out how VCs could run down their investments to near zero. What’s sensible is that the VCs should have done better by following up on how their million-dollar investments in the exchange were doing.

She explained that the VCs must have ignored the red flags surrounding the operations at FTX. She particularly questioned the possibility of conflicts between the VCs from paying attention to the facts they were uncovering. Since that seems highly improbable, they will need sittings with the CFTC to explain why they did not report any anomalies.

What Goldsmith Romero said sums up a growing sentiment in the crypto space that crypto stakeholders have neglected their roles. The industry is in chaos due to stakeholders failing to perform their duties as expected. 

One key player who backed this sentiment is shark tank star Kevin O’Leary. O’Leary said that the fall of another exchange is imminent as long as the regulation is not in place. Keep watching FintechExpress for finance news to be updated as soon as they happen.