The U.S. Securities Exchange Commission (SEC) is cautioning publicly traded firms that if they have been affected by the recent FTX-led FTT/USD disruptions in the industry, they need to inform their investors.
What Happened: The Division of Corporation Finance informed U.S. public companies on Thursday that there has been a considerable disruption in the cryptocurrency asset market due to “recent bankruptcies and financial distress among crypto asset market participants.”
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This demonstrates that regulators are keeping a close eye on the consequences of the downfall of crypto companies such as FTX and BlockFi Inc.
“Companies may have disclosure obligations under the federal securities laws related to the direct or indirect impact that these events and collateral events have had or may have on their business.”
The SEC also urged crypto companies to provide details on whether they have any financially significant involvement with counterparts that have gone bankrupt or become insolvent.
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