The spectacular collapse of one of the biggest names in cryptocurrencies, FTX, is sending shock waves through Washington, as politicians on the receiving end of millions of dollars in donations from the firm’s disgraced leaders scramble to distance themselves from the fiasco and others aim their sights on federal regulators who stood by while the company fleeced as many as a million customers out of their money.

At least two lawmakers who received money from executives tied to FTX have already announced that they donated it to local charities in their districts. The campaigns of Representatives Jesús “Chuy” García, a Democrat of Illinois, and Kevin Hern, a Republican of Oklahoma, told Politico they gave up $2,900 and $5,000, respectively.

The donation to Mr. Garcia’s campaign was from the FTX chief executive, Sam Bankman-Fried, and the donation to Mr. Hern came from the co-CEO of FTX’s digital markets arm, Ryan Salame. Others have said they are considering returning the funds to the donors, but are wary of appearing to finance the executives’ legal defense during what is shaping up as months — if not years — of probes by regulators and prosecutors into FTX’s dramatic implosion.

The cryptocurrency exchange, which was estimated to be worth as much as $32 billion earlier this year, filed for bankruptcy last week after proving itself unable to cope with a rush of customer withdrawals following reports about its financial stability. In bankruptcy court filings, the company said it and its web of more than 100 affiliated companies may have as many as 1 million creditors. 

“The events that have befallen FTX over the past week are unprecedented,” the court filing said. “Barely more than a week ago, FTX, led by its co-founder Sam Bankman-Fried, was regarded as one of the most respected and innovative companies in the crypto industry.”

The company added that there is “substantial interest in these events among regulatory authorities around the world,” and that it has been in contact with federal prosecutors, the Securities and Exchange Commission, the Commodity Futures Trading Commission, and “dozens of federal, state, and international regulatory agencies” since its bankruptcy filing in Delaware.

Mr. Bankman-Fried has been a familiar face in Washington in recent years, meeting with members of Congress, financial regulators, and officials at the White House in an effort to curry support for the nascent cryptocurrency industry. The access was facilitated by millions of dollars in political contributions by Mr. Bankman-Fried and other executives at the company since 2020.

Data compiled by OpenSecrets, a watchdog group that monitors the money flowing into federal election campaigns, suggest that Mr. Bankman-Fried during the 2022 election cycle donated a total of $39.8 million to Democratic campaigns and causes. The sum makes Mr. Bankman-Fried the second-largest donor to left-wing politicians and causes, behind only financier George Soros, who donated $128.5 million during the same period.

The bulk of Mr. Bankman-Fried’s money, or $28 million, went to candidates via the Protect Our Future political action committee, which he founded in early 2022 ostensibly to back candidates supporting pandemic preparedness efforts. In 2020, Mr. Bankman-Fried’s $5.2 million donation to President Biden’s presidential campaign made him the second-largest individual donor to the candidate. 

During a podcast in May, Mr. Bankman-Fried said he wanted to donate more than $100 million, and perhaps as much as $1 billion, during the 2024 election cycle, a pledge that, had he been able to deliver, would have made him the largest individual donor ever in a U.S. election.

Another executive at FTX, Mr. Salame, donated primarily to Republican campaigns and causes, ponying up $23.6 million during the 2022 cycle. Together with another executive, Nishad Singh, the trio poured more than $70 million into this year’s midterm elections, making FTX the third-largest contributor in the American political landscape this year. The figure is 10 times what the company donated during the 2020 cycle.

Fallout from the FTX collapse was on full display during a hearing of the Senate Banking Committee Tuesday, with Democrats praising Biden-appointed regulators such as the SEC’s Gary Gennsler for his crypto-skepticism, and Republicans chiding the same regulators for not giving crypto-related companies clear regulatory guardrails that would have prevented what one senator called “chuckleheads” like the FTX executives from running amok.

“We shouldn’t take the wrong message from what happened last week,” Tennessee’s Republican senator, Bill Hagerty, said. “No amount of poorly considered, knee-jerk overregulation here in the U.S. would have prevented a foreign-domiciled company like FTX from doing what it did.”

Several Republicans in Congress have hinted that when the GOP takes over the House in January, they will focus their attention on Mr. Gennsler. They want to know how the FTX saga unfolded under his nose, and why he and his staff were meeting with Mr. Bankman-Fried and other FTX officials as recently as March to discuss the Bahamas-based company’s plans to further develop its American presence.