TRM Labs general counsel Sujit Raman says it will be "very difficult" to recover the money and funds lost by FTX.
The collapse of Sam Bankman-Fried's cryptocurrency trading company FTX was the nail in the coffin for cryptocurrencies, according to many long-standing supporters of the industry.
The FTX crash heralded a mass exodus from cryptocurrency, with investors pulling $20 billion out of global cryptocurrency trading circles in November alone, or roughly 15% of the industry, according to The Wall Street Journal.
The trend is largely due to small investors whose trust in cryptocurrencies has finally dried up.
“A lot of bad actors have been exposed,” Nick Torrico, a financial worker who had $10,000 invested in another now-bankrupt business venture, told the WSJ. "My biggest lesson is to be patient and not try to make a quick buck."
EX-CRYPTO BOSS SAM BANKMAN-FRIED CRACKED FOR COMMITTING 'PURE AND SIMPLE FRAUD, GOOD OLD-FASHIONED'
FTX CEO Sam Bankman-Fried attends a news conference at FTX Arena in downtown Miami on June 4, 2021. (Matias J. Ocner/Miami Herald/Tribune News Service via Getty Images) (Matias J. Ocner/Miami Herald/Tribune News Service via Getty Images)
This illustrative photo shows a smartphone screen displaying the logo of cryptocurrency exchange FTX, with a screen displaying the FTX website in the background in Arlington, Virginia on February 10, 2022. (Olivier Douliery/AFP via Getty Images/Getty Images)
FTX was not the only cryptocurrency trader to crash this year, even though its spectacular crash grabbed all the headlines. Voyager Digital and Celsius Network also filed for bankruptcy this summer, raising concerns that FTX's slump only got worse.
Bankman-Fried is currently in police custody in the Bahamas, where he is expected to accept extradition to the US in the near future. He faces fraud charges from federal prosecutors in New York, the SEC and elsewhere.
SAM BANKMAN-FRIED, FOUNDER OF FTX, CHARGED WITH FRAUD, MONEY LAUNDERING
The SEC alleges it may have wasted millions in campaign donations, the vast majority of which He went to the Democrats.
The cryptocurrency mogul ranked sixth on the overall list of individual donors for the 2022 midterms with respect to federal contributions. According to Open Secrets, a Washington, DC-based nonprofit, Bankman-Fried's total contributions during the midterm election cycle totaled nearly $40 million.
(EDITORS NOTE: Best quality available) Sam Bankman-Fried, founder of FTX, left, and his mother Barbara Fried at Magistrates Court in Nassau, Bahamas on Tuesday, December 13, 2022. To Bankman-Fried He was denied bail by a judge, leaving the disgraced co-f (Katanga Johnson/Bloomberg via Getty Images/Getty Images)
The PAC of the majority of the House and the Senate Majority PAC together received $7 million from Bankman-Fried in the past two years, according to The Washington Post.
CLICK HERE TO GET THE FOX BUSINESS APP
None of the Democratic PACs said whether they plan to return any of Bankman-Fried's donations, according to WaPo. Neither organization immediately responded to a request for comment from Fox News Digital.
Fox News' Danielle Wallace contributed to this report.
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/thenational/CAPNPZ6QZKFKIPPSCNKCJAXMPA.jpg?w=75&resize=75,75&ssl=1 "Auditing firm Mazars suspends all work for cryptocurrency clients")
