This relief is unjustified, as is the faith that the cryptocurrency industry will get better and be different. Since Bankman-Fried’s conviction, there have been no changes that would prevent a new crypto mania just as devastating as the last.exchange and the Alameda Research trading firm, was convicted in early November on seven charges of fraud and conspiracy.
that he based his entire due diligence process on unaudited financial statements. He said this was the norm for the company’s crypto counterparties “because of issues with getting audits”. It bankrupted his company., and many others like him throughout 2022, stemmed not from proactive regulators protecting investors by cracking down on widespread malfeasance, but rather from the enormous implosions of the cryptocurrency firms built on rickety, risky loans and illusory tokens.
Rather than protecting investors from these predatory crypto schemes, financial regulators and enforcers only stepped in once it was time to pick up the pieces and comb through the rubble of millions of people’s shattered investments. These agencies have been playing catch-up, laggardly investigating and charging people like Bankman-Fried or his cryptocurrency rival, Changpeng Zhao, after problems at FTX and Binance ballooned to enormous size.