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- Lawmakers slam Sam Bankman-Fried over surprise crypto bill endorsement
- Bipartisan backlash grows after prison post shakes Senate debate
- Clarity Act faces scrutiny following jailed FTX founder support
Tensions flared on Capitol Hill after former FTX CEO Sam Bankman-Fried voiced support for a major cryptocurrency bill while serving his prison sentence. The instant reaction to his support of the Clarity Act was a sharp response by both party lawmakers. As a result, a typical lawmaking effort became a political battleground.
In a post on X, Bankman-Fried agreed with his view. He termed the Clarity Act as one of the milestones of the digital asset industry. Also, he tied the developments of the bill to the incumbent US president, Donald Trump. In the same message, he condemned former Securities and Exchange Commission Chair Gary Gensler. His remarks soon became widespread among policy-makers who were already discussing crypto regulation.
Bankman-Fried sponsored the Digital Commodities Consumer Protection Act in 2022 before his conviction. He had encouraged Congress to enact that proposal just before his arrest. But a subsequent conviction of fraud and conspiracy hurt the hopes of the bill. The prosecutors discovered that he embezzled billions of dollars of customer money in FTX. A federal court sentenced him to 25 years in prison. He has also been appealing the decision and posting regularly on social media.
Also Read: South Korea Cracks Down on Crypto Influencers With New Law
Lawmakers Reject His Endorsement
According to her X statement, Republican Senator Cynthia Lummis reacted publicly. She claimed that her legislative work has been quite different from the steps Bankman-Fried had taken before. In addition to that, she said that the extensive reform would have subjected her to a longer jail sentence. Lummis said that politicians do not require and are not desiring his support.
Democratic Senator Elizabeth Warren had also criticized involvement. His support, according to her comments, should be a cause for alarm. She pointed out that whatever market structure bill should be, it should focus on the protection of investors and financial stability. Warren is a key figure in the development of crypto supervision in the Senate Banking Committee.
In the meantime, the Clarity Act has been passed by the House. Lawmakers in the Senate are still going through negotiations concerning stablecoin yield provisions and regulatory jurisdiction. Furthermore, there are also debates that relate to the cryptocurrency-related investments of President Donald Trump. It was confirmed by one of the White House officials that Trump has no intention of pardoning Bankman-Fried.
With the Senate debates ongoing, the approval of the bill by Bankman-Fried has led to increased scrutiny of the bill. The legislators of both sides have clearly disavowed his support as they continue with the negotiations.
Also Read: Hong Kong’s March Stablecoin Licenses Spark Major Crypto Shift Ahead
