Texas Securities Regulators and Attorney General Object to FTX Purchasing Voyager Digital – Regulation Bitcoin News

Regulators from the state of Texas and the state’s attorney general are objecting to FTX purchasing Voyager Digital, as the state’s securities commissioner needs to “determine whether FTX US is complying with the law.”

Texas State Securities Board and Department of Banking file objections against FTX Buying Voyager digital

According to a bankruptcy court document filed on October 14, 2022, the Texas State Securities Board (SSB), the Texas Department of Banking, and the Texas attorney general are objecting to FTX’s solicitation of Voyager Digital. FTX is the digital exchange owned by crypto-billionaire Sam Bankman Fried. They bid $1.4 Billion to acquire Voyager Digital.

The news follows Bankman-Fried’s statements before the purchase when he said the company was prepared to deploy billions on acquisitions. Before the attempt to purchase Voyager, Bankman-Fried and FTX further announced at the end of July, that he was “happy to do what we can to get liquidity to Voyager’s customers.”

However, regulators from the state of Texas and the state’s attorney general want to stop the acquisition because they believe regulators, and the Texas securities commissioner need to investigate FTX. While FTX is a money services business with FinCEN, the Texas SSB insists FTX is “not, however, registered as a money transmitter or in any other capacity with the Texas Department of Banking and it is not registered as a securities dealer with the Texas State Securities Board.”

Joseph Jason Rotunda (director of the Enforcement Division at the Texas SSB) explained that FTX might be violating the Texas Securities Act. Rotunda said that while he downloaded the FTX mobile applications, and told the firm he was a Texas resident, the FTX application shows Rotunda is “earning yield on [ethereum]” and “the yield is valued at 8 percent APR.”

“An ongoing investigation by the Enforcement Division of the Texas State Securities Board, [shows] the yield program appears to be an investment contract, evidence of indebtedness and note, and as such appears to be regulated as a security in Texas as provided by Section 4001.068 of the Texas Securities Act,” Rotunda’s filing explains. “At all times material to the opening of this FTX account, FTX Trading and FTX US have not been registered to offer or sell securities in Texas.” The Texas SSB director added:

FTX Trading, FTX US could therefore violate Section 4004.051 Texas Securities Act.

On Twitter, Bankman-Fried hasn’t commented on the recent actions filed by the regulators from the state of Texas, and the state’s attorney general. FTX’s CEO, meanwhile, has made it clear that he supports regulation. Just recently, Bankman-Fried explained that he believes enhanced regulatory oversight for the stablecoin industry is “crucial.” On Monday, Bankman-Fried said he looked forward to FTX being regulated in Dubai.

“FTX is excited to be regulated in Dubai by VARA! We’re excited to expand out our presence in the city, and to work with regulators who have taken the lead in establishing a regulatory framework for digital assets, protecting customers, and allowing for innovation,” the FTX CEO tweeted.

In this story, tags
Attorney General Cryptocurrency and Cryptocurrency Dubai, ftx FTX Exchange. FTX Investigation, Joseph Jason Rotunda. Regulation, Regulators Sam Bankman Fried, SSB Director, Texas, Texas Regulations. Texas Securities Act. Texas SSB. Texas State Securities Board. US Regulations. Voyager Digital

How do you feel about Texas regulators objecting to Voyager Digital being purchased by FTX? Comment below to share your thoughts.

Jamie Redman

Jamie Redman is the News Lead for Bitcoin.com News. He also lives in Florida and works as a journalist covering financial technology. Redman is an active participant in the cryptocurrency community from 2011. Since 2011, Redman has been an active member of the cryptocurrency community. Redman is a prolific writer for Bitcoin.com News, with over 6,000 articles on disruptive protocols.

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