SBF succeeds in a Texas action alleging that FTX sales violated securities laws.

Bloomberg News reported Feb. 2 that former FTX CEO Sam Bankman-Fried won early inside a case involving Texas trading rules. In October of last year, Bankman-Fried was the target of accusations from the Texas State Securities Board (TSSB). When FTX US offered yield-bearing products to customers in the United States, the regulatory at the time claimed that Bankman-Fried had broken state securities laws.

Judge Sarah Starnes of Texas determined yesterday that because Bankman-Fried is not a citizen of Texas, the state securities regulator lacks authority over her.

Today's session, at which Bankman-Fried was supposed to testify, was postponed by Judge Starnes. The TSSB may potentially appeal the ruling by submitting an updated petition by March 1 with the judge's permission. According to Bloomberg, the government has not said if it intends to contest today's verdict. Bankman-attorneys Fried's questioned the TSSB's need for to the judge's decision, contending that its accusations simply indicated that Bankman-Fried controlled FTX's different corporations. Bankman-Fried could not have personally broken Texas laws since other FTX members could not have told people about certain things.

The Director of Enforcement for the Texas Securities Board, Joe Rotunda, disagreed. He said that because Bankman-Fried elected to offer stocks to Texas citizens, he “subjected himself to the jurisdiction of Texas' courts”—a claim that Judge Starnes yesterday seemed to concur with. By enforcing fines, the TSSB ultimately hoped to reimburse harmed FTX customers. If the case had been successful, Bankman-Fried might have been subject to fines of up to $20,000 for each state statute broken and up to $250,000 for each impacted Texas citizen over the age of 65.

According to Bloomberg, due to the criminal trial against Bankman-Fried and the bankruptcy action against FTX, other state agencies have mainly abstained from pursuing any action.

What Went Horribly wrong With Crypto Exchange That Caused FTX to Collapse？

Sam Bankman-Fried, the founder and former CEO of the cryptocurrency exchange FTX, and the company are closely related. For years ahead, the fast and severe downfall of FTX in late 2022 will affect the global crypto ecosystem.

The demise of FTX happened more than a 10-day span in November 2022. The turning point came on November 2, when CoinDesk broke the story that Bankman-quant Fried's investment company, Alameda Research, had a $5 billion stake in FTT, the FTX native token. According to the study, Alameda's investing foundation used FTT, a token created by its sister firm, rather of fiat money or another type of cryptocurrency. That raised questions about Bankman-enterprises' Fried's unreported leverage and solvency throughout the cryptocurrency sector.

There was a liquidity problem at FTX. Bankman-Fried made an effort to reassure FTX investors that their funds remained secure, but in the days that followed the CoinDesk revelation, consumers demanded withdrawals totaling $6 billion. Before moving to rival Binance, Bankman-Fried first looked for further funding from venture capitalists. In just two days, the price of FTT dropped by even more than 80%.

Binance stated on November 8 that it had achieved a non-binding deal to buy the non-U.S. The world's largest cryptocurrency exchange essentially bailed out its close competitor by purchasing the operations of FTX for an undisclosed sum.

As a reminder, WikiBit is ready to help you search the qualifications and reputation of projects in a bid to protect you from hidden dangers in this risky industry!

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