The U.S. Securities and Exchange Commission(SEC) has filed a complaint against FTX’s exchange token FTT. The SEC claims FTT was sold as an investment contract and is a "security."
The SEC laid the claim in a complaint filed against FTX co-founder Gary Wang and former Alameda Research CEO Caroline Ellison.
In the complaint, it highlighted that FTX would use proceeds from the token sale to fund the development, marketing, business operations, and growth of FTX while using language to emphasize that FTT is an "investment" with profit potential.
Ellison and Wang have both pleaded guilty to the various charges brought before them, and are not contesting the allegations, the SEC said in a press release.
The duo are also facing Justice Department and Commodity Futures Trading Commission (CFTC) charges related to their conduct at FTX and Alameda, respectively.
