FTX collapse: Kevin O’Leary says isolating crypto from banking system would be “insanity” | FULL

Venture capitalist Kevin O’Leary said Wednesday while testify to the U.S. Senate Banking Committee that isolating cryptocurrency from the American banking system would be “insanity.”

O’Leary said that if legislation were to pass banning banks from integrating cryptocurrencies and technology he would “short every American bank stock” because it would make the American banking sector the most uncompetitive in the world.

He said he believed the cryptocurrency exchange FTX collapsed because it was “at war” with its main competitor Binance, which put it out of business.

The committee also heard from Actor Ben McKenzie, best known for his role as Ryan Atwood from “The O.C.”, who has been an outspoken critic of cryptocurrency. McKenzie called the cryptocurrency industry the “largest Ponzi scheme in history” and said it has highlighted the “myriad failures” of the American banking and regulatory system.

Earlier this week, former CEO Sam Bankman-Fried was charged with orchestrating a scheme to defraud investors by the U.S. Securities and Exchange Commission (SEC). Bankman-Fried was arrested Monday in the Bahamas at the request of the U.S. government, U.S. and Bahamian authorities said.

FTX, which had been among the world's largest cryptocurrency exchanges, filed for bankruptcy protection on Nov. 11 in one of the highest-profile crypto blowups after traders pulled $6 billion from the platform in three days and rival exchange Binance abandoned a rescue deal.

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