The Bahamas Police has launched an investigation after crypto exchange FTX filed for bankruptcy. In light of the global collapse of FTX, a team of financial investigators are investigating whether criminal misconduct has occurred. The police want to work closely with the securities regulator of the island state. The Bahamas is home to FTX’s international operations, as well as outgoing boss Sam Bankman-Fried.
The securities regulator had previously announced that the company was suspected of, among other things, embezzling money from customers. Bankman-Fried’s international crypto platform FTX.com ran into payment problems a week ago after doubts about capital reserves led to a flight of customers and the withdrawal of billions in funds. On Wednesday, it initially looked like competitor Binance would take over most of the ailing group. But that plan fell through the next day.
On Thursday, the Bahamian securities regulator said it had frozen certain assets of FTX and asked a liquidator to handle it. According to FTX, it filed for bankruptcy protection in the US on Friday and Bankman-Fried announced his resignation as boss. However, the 30-year-old said he wanted the handover to the new boss, John J. Ray III. to accompany.
Was there a hacker attack?
The chief legal officer of FTX’s US subsidiary, Ryne Miller, said on Twitter on Saturday that there had been “unauthorized transactions”. The British analysis company Elliptic expressed the suspicion that nearly 459 million euros worth of crypto assets were stolen from FTX on Friday evening. The news website CoinDesk, which specializes in cyber currencies, reported on a hacking attack on the crypto exchange. “FTX has been hacked,” an administrator of the company wrote in a non-public support channel on the Telegram news service. FTX has called on its customers to remove FTX apps and avoid the FTX website.
According to insiders, at least a billion dollars in customer funds have disappeared from FTX. Bankman-Fried secretly transferred $10 billion in client funds from FTX to his own trading firm Alameda Research, two people familiar with the matter told Reuters. Part of this amount has disappeared. Insiders, who until recently held senior positions at FTX, estimated the missing amount to be between $1 billion and $2 billion. The financial gap emerged from documents Bankman-Fried made available to other FTX executives last Sunday.
“Misunderstandings in booking”
Bankman-Fried disagreed that it was not a clandestine transaction. However, there were misunderstandings with the booking, he explains in a text message to Reuters. He was in the Bahamas, said when asked, dismissing speculation that he had flown to Argentina. On Friday, Bankman-Fried said on Twitter that he was surprised by what happened at the crypto exchange he founded and should first get an overview of the events himself.
As a 30-year-old star entrepreneur, Samuel Bankman-Fried had graced the front pages of well-known American business magazines a few months ago. His company, sometimes valued by investors at $32 billion, completely collapsed within days. The FTX debacle also weighed on the already battered crypto market.
Visa ends cooperation
Meanwhile, the world’s largest payment processor Visa is ending cooperation with the insolvent crypto exchange. “We have terminated our global agreements with FTX and the US credit card program is being terminated,” a company spokesperson said Sunday. FTX and Visa announced an expanded partnership in early October, including the launch of account-linked Visa cards in 40 new countries.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
