Wednesday, October 22, 2025

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FTX, Sam Bankman-Fried Under Regulatory Probe For Offering Unregistered Securities

FTX US and its founder Sam Bankman-Fried are being investigated by Texas’ securities commission for allegedly offering unregistered securities, Barrons reported.

“The Enforcement Division is now investigating FTX Trading, FTX US, and their principals, including Sam Bankman-Fried,” Texas State Securities Board enforcement director Joe Rotunda stated in a late Friday filing in the Voyager Digital bankruptcy case.

According to Rotunda, the board is investigating certain accounts offered by FTX US, which pay investors a dividend in exchange for depositing their bitcoin with the firm. These accounts are frequently referred to as “crypto yield farming.”

READ: FTX Investors Seem To Imply That Nothing Much Has Happened In Crypto Since The Start Of 2022

The investigation was mentioned in Voyager’s chapter 11 process, as its auction for the sale of its assets was recently won by FTX for roughly $1.422 billion through one of its subsidiaries. Securities authorities, according to Rotunda, should not allow the firm to purchase the assets until they can assess compliance with the law.

The move marks the latest reach of law enforcement agencies’ investigations into the crypto industry’s operations. This long-standing argument on classifying crypto assets as securities has intensified the regulatory reach over industry players. For instance, Ethereum’s software update to a proof-of-stake mining method is being conjectured by US Securities and Exchange Commission Chairman Gary Gensler as a shift to considering the coin as a security.

“From the coin’s perspective…that’s another indicia that under the Howey test, the investing public is anticipating profits based on the efforts of others,” Gensler said.

The SEC and the Commodity Futures Trading Commission have also reportedly put forward a proposal to require hedge funds to report their bets, including exposure to cryptocurrency. Meanwhile, the US Federal Reserve released an additional set of guidelines for banks that plan to conduct cryptocurrency activities, requiring the financial institutions to notify them of the act before it transpires.

All this comes on the heels of FTX US President Brett Harrison stepping down to an advisory role.


Information for this briefing was found via Barrons and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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