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Crypto roundup: US charges Sam Bankman-Fried | Binance faces CFTC | Bitcoin price

Former FTX Chief Executive Sam Bankman-Fried, who faces fraud charges over the collapse of the bankrupt cryptocurrency exchange, leaves following a hearing at Manhattan federal court in New York City, U.S. January 3, 2023. REUTERS/Andrew Kelly
Former FTX chief executive Sam Bankman-Fried. REUTERS/Andrew Kelly (Andrew Kelly / reuters)

Fallen crypto-tycoon Sam Bankman-Fried has been accused by US prosecutors of paying a $40m (£32.4m) bribe to Chinese government officials.

The allegations were filed in a revised indictment and submitted to a federal court in Manhattan on Tuesday.

Prosecutors allege that the founder of the bankrupt FTX cryptocurrency exchange sent a bribe, denominated in cryptocurrency, to one or more Chinese government officials in an effort to regain access to trading accounts that had been frozen by law enforcement.

Bankman-Fried persistently strived to release the frozen accounts associated with Alameda Research, which involved hiring lawyers to advocate for the company's interests in China, according to the revised indictment.


"In or about November 2021, Samuel Bankman-Fried, a/k/a 'SBF,' the defendant, and others directed and caused the transfer of at least approximately $40m in cryptocurrency intended for the benefit of one or more Chinese officials in order to influence and induce them to unfreeze the Accounts," it said.

The bribery allegations have been added to the 12 existing charges against him, after the collapse of the FTX exchange in November 2022.

Bankman-Fried has yet to be arraigned on five of the now 13 charges against him, according to a letter to the judge overseeing the case.

bitcoin Zhao Changpeng, founder and chief executive officer of Binance, attends the Viva Technology conference dedicated to innovation and startups at Porte de Versailles exhibition center in Paris, France June 16, 2022. REUTERS/Benoit Tessier
Zhao Changpeng, founder and chief executive officer of Binance. Bitcoin held above the $27,000 mark on Tuesday. Photo: Benoit Tessier/Reuters (Benoit Tessier / reuters)

Binance faces the CFTC

The US Commodity Future Trading Commission's (CFTC) action against cryptocurrency exchange Binance rocked crypto markets on Monday.

The CFTC has accused Binance of failing to properly register with regulators and providing unregistered crypto derivatives in the US.

"The Commodity Futures Trading Commission today announced it has filed a civil enforcement action charging Changpeng Zhao and three entities that operate the Binance platform with numerous violations of the Commodity Exchange Act and CFTC regulations," the CFTC said.

Read more: Crypto live prices

Binance's BNB token (BNB-USD) fell 4.9% to $310.

Binance CEO Changpeng 'CZ' Zhao said: "Today, the CFTC filed an unexpected and disappointing civil complaint, despite our working cooperatively with the CFTC for over two years.

"Upon an initial review, the complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterisation of many of the issues alleged in the complaint."

In February, Binance announced its readiness to pay monetary penalties in order to make amends for past transgressions.

Bitcoin price holds at $27,000

After crypto-markets were rocked following the news that Binance had received an enforcement action from the CFTC, bitcoin held above the $27,000 mark.

Bitcoin (BTC-USD) was down 2.8% to $27,084.

Ethereum (ETH-USD) fell 1.4% to $1,732.

US regulators swoop on Binance and Coinbase

The investigation added to already cautious investor sentiment pervading crypto markets, as traders await the outcome of the US Securities and Exchange Commission's (SEC) notice to Coinbase (COIN), and stopped bullish movements in their tracks.

Bitcoin had pumped by over 30% after the collapse of Silicon Valley Bank (SVB) revealed systemic risk stresses in the traditional financial structure.

However, green shoots sprouting across most cryptocurrency charts have been cut, with all tokens falling into the red apart from ripple (XRP-USD), which saw a rise of 3% on Tuesday, up to $0.48.

Despite the current market turmoil, MicroStrategy founder Michael Saylor announced the purchase of 6,455 bitcoins at an average of $23,238 per bitcoin.

Mark Lurie, co-founder of Shipyard Software, said: "The CFTC has fired the US governments' long-awaited opening salvo against Binance, and it's a doozy.

Read more: Europe tops world for crypto startups with London getting most VC funding, study says

"Interpreting this as an attack on crypto, however, would be a mistake.

"The allegations are not about issues that exist 'in a gray area of regulation', but rather about evasion of cut-and-dry, well-understood regulations and rules that exist for pretty good reasons."

Yamina Sara Chekroun, head of legal US at Ramp, told Yahoo Finance UK: "This is a signal to the industry that jurisdictional controls are going to be closely monitored and enforced and that global actors may be brought to answer in US courts.

"We believe that strong periodical reviews of internal compliance policies and implementation of the processes of these policies will help all digital asset businesses comply with the new guidance, if any, this case may bring."

Watch: The reasons why UK banks are blocking crypto exchanges | The Crypto Mile

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