Per CNBC

Sam Bankman-Fried allegedly used FTX customer funds to use as donations to political campaigns. Although publicly donating to the Democrats, he announced that he also made "dark" donations to the Republicans.

The Feds charged SBF with misappropriating customer funds in tens of millions of US dollars to make political donations to both the Democratic and Republican candidates. These donations were deemed illegal.

According to the prosecutors, the FTX founder made these donations to influence the policies and laws that affect the crypto industry. SBF has long been the poster boy for crypto regulation, appearing in several hearings to call for a bill regarding regulations on the industry.

Sam Bankman-Fried was reportedly a major political donor giving $5.2 million to the presidential campaign of now-US President Joe Biden, per Coin Desk. Another $40 million was also spent mainly on Democratic candidates ahead of the midterm November elections.

SBF was a vocal supporter of the bipartisan Digital Commodities Consumer Protection Act (DCCPA), backed by Sen. Debbie Stabenow and Sen. John Boozman. The FTX founder donated $26,600 to Stabenow and $8,700 to Boozman, per the FEC.

SBF: "I’m optimistic that the Stabenow-Boozman’s bill will provide customer protection on centralized crypto exchanges without endangering the existence of software, blockchains, validators, DeFi, etc."

The bill was filed to oversee the spot digital commodity market and other purposes. It was reportedly designed for industry safeguards and would result in the Commodity Futures Trading Commission having more oversight.

Stabenow: “The DCCPA does not take authority away from other financial regulators. Nor does it make the CFTC the ‘primary’ crypto regulator,”

Attorney Joe Silvia said that the bill, which SBF publicly supported, could have actually helped avoid the FTX debacle altogether. Sen. Cory Booker said that it is also important that a regulatory framework would be provided to protect consumers, per CNBC.

Booker: "I think it’s important that we move forward with providing a regulatory framework that can protect consumers.”

Should the bill have been passed, digital commodities platform applicants would have to officially register with the CTFC as a commodities broker, trading facility, custodian, or dealer. This bill would also require platforms to provide transaction records when requested.

Resources:

See flow at unusualwhales.com/flow.