- Former SEC Chair Gary Gensler has come under fire after a year’s worth of his text messages went missing, coinciding with the FTX collapse.
- Experts warn the loss raises serious concerns about SEC transparency and whether key regulatory decisions were influenced by now-vanished conversations
A new report from the U.S. Securities and Exchange Commission (SEC) has ignited fresh controversy surrounding former Chair Gary Gensler. According to the agency’s Office of Inspector General (IG), nearly a year’s worth of text messages from Gensler’s government-issued phone were lost. Interesting fct is that this event perfectly coincides with one of the most turbulent chapters in the crypto industry: the collapse of FTX.
SEC Confirms Missing Messages
The SEC report revealed that text messages sent and received on Gensler’s phone between October 18, 2022, and September 6, 2023, were permanently lost due to what the IG described as “avoidable” technology failures.
Excuse being that these failures included weak change management practices, missed system alerts, inadequate backup procedures, and unresolved software flaws.
Investigators were able to recover around 1,500 messages through alternative records. Alarmingly, nearly 38% of these texts were classified as “mission-related,” including critical crypto conversations.
One example cited was a May 2023 discussion between Gensler, SEC staff, and the Director of the Division of Enforcement about potential actions against crypto trading platforms and their founders.
The IT department’s failure to collect essential log data further compounded the issue, leaving regulators unable to determine why Gensler’s smartphone stopped syncing with the SEC’s management systems.
Timing Sparks Crypto Industry Suspicion
Crypto experts argue the timing of these missing texts is far from coincidental. The lost records align with pivotal events, most notably the November 2022 collapse of FTX and the ongoing legal battle over Grayscale’s spot Bitcoin ETF.
Nate Geraci, President of NovaDius Wealth Management, highlighted
“Think about everything that happened in crypto during this time. Basically, FTX collapse through the Grayscale spot BTC ETF lawsuit. Makes you think.”
Speculation has long swirled around Gensler’s alleged communications with Sam Bankman-Fried (SBF) and his team before FTX filed for bankruptcy. Reports suggested that intermediaries may have helped arrange meetings between the former SEC Chair and the disgraced FTX founder.
Political and Regulatory Fallout
Gensler, widely criticized in the crypto community for his aggressive stance on digital assets, left office amid growing scrutiny. His successor, Paul Atkins, appointed under the Trump administration, has signaled a more crypto-friendly approach, recently declaring that most cryptocurrencies are not securities.
For many industry insiders, the missing texts raise not only questions of transparency but also suspicions about whether key regulatory decisions were influenced by conversations now lost to history. The controversy underscores the broader debate about accountability and record-keeping at the SEC, especially as the agency continues to play a decisive role in shaping crypto regulation.
With the timing of the disappearance aligning so closely with FTX’s implosion, critics argue the incident risks further eroding public trust in the SEC’s oversight. Whether the missing messages will ever resurface, or whether their absence will deepen suspicions, remains to be seen.
