• Sam Bankman-Fried was a major donor to the Democratic Party in the US, donating $45.2 million ahead of the 2022 midterm election.
• The Democratic National Committee (DNC) is only returning 2.2% of that money – or $1 million – to FTX’s bankruptcy estate.
• FTX and its group of crypto companies filed for Chapter 11 bankruptcy in early November, resulting in Bankman-Fried’s arrest in The Bahamas.
Sam Bankman-Fried: Major Political Donor
FTX founder Sam Bankman-Fried was a major donor to the Democratic Party in the US, donating more than $46m to candidates and groups affiliated with it before his crypto trading firm Alameda Research collapsed and FTX filed for Chapter 11 bankruptcy.
Returning Funds To FTX
The funds that are now being returned by Democrats make up just 2.2% – or $1 million – of what Bankman-Fried donated to political candidates from the Democratic Party. Of the $1m, the DNC has said it would return $850,000 to FTX. John Ray III, FTX’s new CEO, had requested that some of these donations be returned back to their bankruptcy estate by February 28th.
Donations To Republicans
Bankman-Fried has also said in an interview with crypto influencer Tiffany Fong that he donated anonymously to Republican politicians because “journalists freak out” if they find out about such donations.
George Soros: Top Donor For 2021/2022 Election Cycle
According to available data, Bankman-Fried was the second largest donor to the Democratic Party after billionaire George Soros during this election cycle.
Bankruptcy & Arrest In The Bahamas
FTX and its group of crypto companies filed for Chapter 11 bankruptcy in early November while Sam Bankman-Fried was later arrested by US prosecutors in The Bahamas on suspicion of insider trading and other financial crimes related to his time at Alameda Research and FTX .
- The New York Department of Financial Services (NYDFS) is reportedly investigating Paxos, a prominent player in the stablecoin market and issuer of Binance USD (BUSD) and the native Paxos stablecoin USDP.
- Paxos has applied for a full banking charter and has obtained the coveted BitLicense from NYDFS as well as a Major Payments Institution license from Singapore.
- Regulators seem poised to move on legislating the crypto industry this year, leaving markets on edge as Paxos operates BUSD at a time when uncertainty clouds the Binance exchange.
Investigation into Stablecoin Issuer Paxos
New York’s Department of Financial Services (NYDFS) is launching an investigation into Paxos, a prominent player in the stablecoin market that issues Binance USD (BUSD) and its native Paxos stablecoin USDP. The news comes after reports that the Securities and Exchange Commission forced Kraken to close its staking facilities.
Paxos Applies for Full Banking Charter
Paxos is currently operating in New York with a coveted BitLicense obtained from NYDFS, as well as a Major Payments Institution license from Singapore. Rumors suggest that the Office of Comptroller of Currency was contemplating requiring Paxos to withdraw its application for a full banking charter, however this was denied by the company itself. In 2021, OCC provided provisional banking charter to Paxos suggesting that they are not completely against licensing them properly.
Legislation of Crypto Industry Imminent
With regulators seemingly poised to move on legislating crypto industry this year, markets are on edge especially since Paxos operates BUSD at a time when uncertainty clouds over Binance exchange. This could be what has drawn attention from authorities prompting them to launch an investigation into this project.
PaxG Gold-Backed Cryptocurrency
Another project under scrutiny by authorities is PAXG – gold-backed cryptocurrency stored in Brinks Vault London for investors. PAXG, along with BUSD and USDP all remain pegged at the time of writing.
As proposed regulations continue to be introduced regarding cryptocurrencies, it remains uncertain how these will impact projects such as those issued by Paxos – particularly given their high profile nature within both traditional finance and blockchain industries.