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Sam Bankman-Fried, the founder of FTX, will be investigated by US prosecutors for theft and market manipulation

According to a story in the New York Times, federal prosecutors in the United States will investigate whether or not FTX founder Sam Bankman-Fried manipulated the market for two cryptocurrencies in May, contributing to their collapse and the downfall of his own cryptocurrency exchange.

The breakdown of an acquisition plan involving rival exchange Binance caused billions in withdrawals from users, and FTX, once valued at $32 billion, filed for bankruptcy protection last month.

Prosecutors are examining whether or whether Bankman-Fried manipulated the TerraUsd and Luna exchange rates to enrich the companies he owned, such as FTX and Alameda Research. As a result of his attempt to save Alameda by using FTT tokens and user monies as security, Bankman-Fried is also being probed for theft and misappropriation of funds.

According to the publication, authorities have not yet established whether or whether Bankman-Fried committed any illegality, and it is unclear when exactly they began investigating into the TerraUSD and Luna deals.

Officials in the United States and the Bahamas, where FTX is headquartered, are among those looking into whether or not Bankman-Fried had any hand in the company’s spectacular demise.

When an acquisition plan with Binance, a competitor exchange, fell through, causing billions in withdrawals from consumers, FTX, once worth $32 billion, filed for bankruptcy last month.

Formerly the second-wealthiest millennial in the world behind Mark Zuckerberg, Bankman-Fried apologised for his “number of blunders” in managing the cryptocurrency exchange last week but denied any intention of fraud.

Investors and potential investors in FTX have reportedly been contacted by U.S. officials in recent weeks to provide information.

New York’s federal prosecutors, according to the sources, want to know about any contacts these companies may have had with the cryptocurrency firm’s officials, including Bankman-Fried.

On Sunday, Bankman-Fried announced that, after he had “finished learning and reviewing” what led to FTX’s downfall, he would testify before the US Congress regarding the disaster.