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US Government Appeals for Independent Examination of FTX Cryptocurrency Exchange

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It is reported that the US government appealed against the judicial decision not to appoint an independent examiner to investigate the bankruptcy of the FTX Cr…

US Government Appeals for Independent Examination of FTX Cryptocurrency Exchange

It is reported that the US government appealed against the judicial decision not to appoint an independent examiner to investigate the bankruptcy of the FTX Cryptocurrency Exchange on Monday. The United States trustee is a branch of the Department of Justice (DOJ). It has previously argued that the bankruptcy law requires independent investigation of any case of this size, although some people warned that it may cost up to $100 million. The trustee said that the independent examiner could investigate whether those responsible for the poor management of FTX were still part of the company. A bipartisan group of senators also called for an independent investigation.

The US government appealed against the refusal of the FTX bankruptcy examiner to appeal

Interpretation of the news:


The United States government has appealed against the judicial decision to not appoint an independent examiner to investigate the bankruptcy of the FTX Cryptocurrency Exchange. The US Trustee, which is a branch of the Department of Justice (DOJ), argued that bankruptcy law mandates independent investigation of any case of this size. FTX, a cryptocurrency exchange founded in 2019, declared bankruptcy early this year citing insolvency due to a significant loss caused by a glitch in Ethereum’s transaction.

The trustee specified that an independent examiner would carry out the investigation and inquire whether the executives responsible for the mismanagement of FTX have left the company or not. In this case, appointing an independent examiner would uncover the complete scope of the bankruptcy and investigate possible corruption, a step towards ensuring that the company’s creditors receive fair compensation.

However, it is worth noting that the independent investigation could cost up to $100 million, which is a considerable amount of money. Despite the significant sum, the bipartisan group of senators urged the DOJ to conduct an impartial and thorough investigation into the cryptocurrency exchange. The lawmakers’ call to investigate FTX aligns with the increasing scrutiny on cryptocurrency exchanges and digital assets, with the industry’s overall lack of regulations allowing fraudulent practices to thrive. By initiating an investigation, the US government can hold executives of cryptocurrency exchanges accountable and protect investors’ interest.

In summary, the US government has appealed to appoint an independent examiner to investigate the FTX Cryptocurrency Exchange’s bankruptcy, which involves ensuring that the responsible parties are held accountable for their actions. Despite the potential cost implications, a bipartisan group of senators have also called for an independent investigation, highlighting the importance of a transparent and fair compensation process for FTX’s creditors. The case serves as a reminder of the issues surrounding cryptocurrency exchanges and the larger need for industry regulation.

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