Cheddar News breaks down Tuesday’s crypto hearing after Sam Bankman-Fried was arrested in the Bahamas on Monday night.

Good2Know: FTX Fallout

and it's time for good to know. Your daily dose of knowledge nuggets about today's top stories. The headliner for today's crypto hearing on Capitol Hill didn't make it to Washington after being arrested in the Bahamas late last night lisa Benetton is here to unravel everything you need to know about the F. T. X. Fallout lisa. Hi Hannah. Well, we've been following this one closely here at cheddar. But if you miss today's testimony, don't worry. Here are the highlights. Civil and criminal charges have been quickly mounting against Sam bank man freed. Founder of the now collapsed Cryptocurrency Exchange, F. T. X. That has lost at least $1 billion and customer funds. And Bateman freed was expected to testify during the House Committee on Financial Services hearing about the company's collapse. But after he was arrested, the hearing moved forward without him with the current ceo john J ray in the hot seat. And here's how Ray summed up FT. X's fatal flaw. Today. The F. D. X. Group's collapse appears to stem from absolute concentration of control in the hands of a small group of grossly inexperienced and unsophisticated individuals who failed to implement virtually any of the systems or controlled that are necessary for a company entrusted with other people's money or assets. And the new ceo has said that F. T. X. Was even worse than Enron. I'll let him explain the the f. D. X. Group is unusual in the sense that, you know, I've done probably a dozen large scale bankruptcies over my career, including in run of course ah every one of those entities had some financial problem or another. Uh They have some characteristics that are in common. Uh This one is unusual and it's unusual in the sense that literally, you know, there's no record keeping whatsoever F. T. X. Worse than Enron that says something lisa and we know this morning came with a fresh filing of civil charges from the sec. Tell us more about that. Well, it's not looking good to say the least. The sec claims since at least May of 2019 FT X. Raised more than $1.8 billion from investors while portraying the company as a safe responsible crypto trading platform with sophisticated automated risk measures to protect customers assets. But in reality bank, Manfred spent years diverting FT. X. Customers money to his own privately held crypto hedge fund. The sec chair, Gary Gensler put it this way, Sam Blankman freed. Built a house of cards on a foundation of deception while telling investors that it was one of the safest buildings in crypto. And with the investigation's still ongoing, this will surely not be the last we're learning about bank man freed and the downfall of F. T. X. Quite the analogy from the sec chair at least a Benetton live in D. C. Thank you so much lisa