New CEO outlines FTX collapse in congressional hearing

SHORTLY after US regulators charged FTX founder Sam Bankman-Fried with defrauding investors on Tuesday (Dec 13), the crypto exchange’s new CEO told lawmakers the collapse stems from poor management practices and inexperienced individuals at the helm.

“The FTX group’s collapse appears to stem from absolute concentration of control in the hands of a small group of grossly inexperienced, non sophisticated individuals,” said John Ray, who was named CEO of FTX after Bankman-Fried stepped down and the company filed for bankruptcy Nov 11.

Ray also said there was virtually no distinction between the operations of FTX and Alameda Research, Bankman-Fried’s crypto trading firm that maintained close ties with his exchange.

Bankman-Fried was arrested on Monday evening in the Bahamas and was set to appear before a magistrate on Tuesday. The Bahamas attorney general’s office said it expects he will be extradited to the United States. REUTERS