Note that FTX founder Sam Bankman-Fried’s affairs are getting worse. He is now under house arrest in California, but that doesn’t stop him from trying to influence the proceedings.

The day before it was revealed that Sam had been in contact with Ryan Miller, the current general counsel of FTX US. Crucially, this was also done using Signal messenger, which supports message encryption and a delete function. Consequently, the prosecution has suggested that Bankman-Fried should be barred from using something like this.

Last night, sources published the emails that Sam had been sending. In one of them, Bankman-Fried suggested that one of the witnesses in the case build a “constructive relationship”. Naturally, this could be seen as an attempt to influence the case.

Email from Sam Bankman-Fried to one of the witnesses in the case

Sam also sent emails to current FTX executive John Ray. In them, the former entrepreneur offered to meet and stated his willingness to help.

Sam Bankman-Fried’s letter to FTX executive John Ray

As such, it can be speculated that Sam’s conditions of being “out” may soon become stricter.

Why the FTX crypto exchange shut down

According to Decrypt’s sources, ASIC members held a phone conversation with FTX representatives on March 30, during which the company outlined its success in complying with the regulator’s regulatory requirements. The giant’s staff also promised to warn customers about fraud. However, the arguments presented were still not optimistic for the agency’s representatives.

In the months that followed, the Australian Securities and Investments Commission sent three notices to FTX Australia asking for more information about its operations.

These notices were not released as part of a freedom of information request on the grounds that such a request could interfere with the regulator’s enforcement efforts. Up until October, “extreme concern” about FTX’s prospects persisted in internal ASIC emails.

FTX native token rate over time

Already in November, the exchange filed a formal bankruptcy petition, making all the fears of the Australian regulator’s experts a reality. In a subsequent interview, the ASIC speaker made the following statement.

Since March 2022, the Australian Securities and Investments Commission has asked FTX Australia about the financial products offered by FTX Australia. Issues raised included pricing, the company’s compliance with the regulator’s order to interfere with investment products and customer engagement.

Amusingly, FTX Australia was not approved by the authority before its launch because it bypassed normal licensing procedures. It did so by acquiring an existing company that already had an Australian Financial Services Licence (ASFL) in 2021. That company, represented by IFS Markets, had itself obtained its licence by taking over another company called Forex Financial Services a year earlier. Accordingly, the scheme here is clearly not the best.

FTX used similar tactics for its European division, which was set up just weeks before announcing the expansion in Australia. By buying Cyprus-based K-DNA, the company was licensed by the Cyprus Securities and Exchange Commission (CySec), which can be used to offer its services across the thirty countries of the European Economic Area (EEA).

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While FTX previously only planned to expand, the company’s lawyers in bankruptcy court are now insisting that at least one foreign affiliate – the exchange’s Turkish unit – be excluded from the protocols. According to the lawyers’ statement, “there is no reason to believe that the Turkish government will comply with the orders of this court”. Accordingly, the exchange will not be able to “exercise sufficient control” over the affairs of the Turkish unit.

Shortly after FTX filed for bankruptcy in November, Turkey’s Finance Ministry launched an investigation into the exchange’s collapse, focusing on the local FTX Turkey subsidiary. At the end of the same month, FTX Turkey’s assets were seized. The branch is 80 per cent owned by FTX Trading Ltd, with the remaining 20 per cent owned by SNG Investments, a subsidiary of Alameda Research LLC, also founded by former FTX CEO Sam Bankman-Fried.

FTX ex-CEO Sam Bankman-Fried

FTX Turkey and SNG Investments are marked as “not strategic” for FTX’s global operations in the court record. In addition, Turkish nationals have begun filing separate lawsuits against FTX Turkey, meaning that the assets of the Turkish unit may already be the subject of these proceedings. Consequently, the Turkish subsidiary’s affairs have been proposed to be put “on the back burner” in the US court.


It seems that the Australian regulator has indeed been cautious and vigilant. Alas, it didn't go anywhere, and the collapse of the FTX crypto exchange still resulted in billions of dollars in losses for ordinary users. One would like to believe that in the future such agencies will not only monitor the markets, but also react to them in time. Otherwise, there is little point in such activities, as they do not save ordinary investors.