Canadian entrepreneur and “Shark Tank” star Kevin O’Leary slammed crypto exchange Binance— and claimed it caused the collapse of FTX on purpose.
Speaking at the Senate Committee on Banking, Housing and Urban Affairs hearing, the celebrity businessman also said Binance is a “massive, unregulated monopoly now.”
FTX, once one of the biggest digital asset exchanges on the planet, last month collapsed spectacularly— prompting lawmakers to think more than ever about how to regulate digital assets. The title of today’s hearing was “Crypto Crash: “Why the FTX Bubble Burst and the Harm to Consumers.”
O’Leary— who was heavily invested in FTX—told the hearing: “I have an opinion, not the records. One put the other out of business—intentionally.”
Binance, the world’s biggest cryptocurrency exchange, played an early part in the collapse of mega exchange FTX last month. Binance CEO Changpeng “CZ” Zhao announced that he would be selling the exchanges holdings of FTX’s native token, a move that triggered a liquidity crisis. Days later, FTX filed for Chapter 12 bankruptcy.
The exchange’s bankruptcy trashed the crypto market—including several companies with exposure to the behemoth.
O’Leary also argued for stronger regulation, noting that FTX-owned derivatives trading platform LedgerX was the “only entity that didn’t go to zero” following the crash because it was regulated by the Commodity Futures Trading Commission.
And he wasn’t the only one: Sen. Cynthia Lummis (R-WY) told the hearing that it was time to “separate digital assets from corrupt organizations.”
FTX is good old fashioned fraud,” she said. “Mismanagement, failure of people, inadequate controls is what’s on trial. We need to regulate this business and lay digital assets on top of our existing financial framework.
FTX’s ex-CEO and founder Sam Bankman-Fried was arrested in The Bahamas over the weekend after U.S. feds requested his extradition from FTX’s home country. He is now under investigation and faces eight criminal charges.
The disgraced crypto mogul had been billed to testify at House hearing before his arrest— despite agreeing to participate in a House committee hearing that took place without him yesterday. He previously said his testimony was likely to be “underwhelming.”