Leaked Emails Reveal Shocking Connection Between SBF, CFTC Commissioner Wetjen And FDIC Chairman Gruenberg

While the Federal Deposit Insurance Corporation (FDIC) has been making headlines over the past weeks because of its role in the historic collapse of some major banks in the U.S., a series of leaked emails have revealed the shocking connection between disgraced former FTX CEO Sam Bankman-Fried, Commodity Futures Trading Commission (CFTC) commissioner Mark Wetjen and FDIC chairman Martin Gruenberg.

Bankman-Fried was dubbed the "Golden Boy" of cryptocurrency and one of the most prominent personalities in the crypto space long before he was charged with a plethora of lawsuits over allegations of user funds misappropriation.

He was also a staunch supporter of U.S. politicians and political action committees (PACs), and regulators and political figures seemed to have grown fond of his advocacy for regulating cryptocurrency and effective altruism.

When FTX filed for bankruptcy last November, Bankman-Fried and his inner circle's political links were uncovered through various investigations.

Interestingly, Washington Examiner shared several emails, showing how Bankman-Fried tried to sway FDIC, through its chairman, to embrace crypto-friendly regulations, nearly six months shy from the collapse of his empire. The emails were from Protect the Public's Trust, the watchdog group that educates the public about the potential misconduct of government officials.

The embattled FTX founder, at the time, used former CFTC commissioner Mark Wetjen, who joined FTX US as its head of policy and regulatory strategy in November 2021, to reach out to FDIC chairman Gruenberg.

In one of the leaked emails, Wetjen informed the FDIC chair about FTX's risk model, which was about its pending application at the CFTC, seeking to amend regulations that would foster more federally authorized crypto products.

"Sam and I have worked in traditional market structures, and I strongly believe the FTX model is all things considered a superior model," Wetjen said in his email.

"We are in the unusual position of begging the federal government to regulate us. ... We would be thrilled to explain these points further in person if you are amenable to a meeting," he said, adding, "And to the extent the crypto industry comes up in discussions through FSOC [Financial Stability Oversight Council] or otherwise, we wanted you to have this context and our views at FTX about where the federal government should keep its focus as it considers the risks posed by the crypto industry."

The FDIC chairman met with Bankman-Fried and Wtjen, which was backed by Gruenberg's email to Wetjen and was confirmed by an FDIC spokesperson, who described the meeting as just part of the chairman's "routine courtesy visits with leaders of financial firms and institutions."

"It seems that Sam Bankman-Fried and his colleagues at his failed firm FTX were looking to influence crypto regulations to their advantage," said Michael Chamberlain, director of Protect the Public's Trust.

"Perhaps we should consider ourselves fortunate because were it not for FTX's precipitous collapse, the executives now facing federal indictments may have been the primary drivers of government oversight of themselves and their competitors," he added.