Written by 1:56 pm Science & Technology Views: 0

Bahamian regulator says it seized $3.5 billion of FTX crypto assets for ‘safekeeping’

FTX logo on laptop screen.

Andrei Rudakov | Bloomberg via Getty Images

The Bahamas Securities Commission says it has seized $3.5 billion price of cryptocurrency from the failed FTX cryptocurrency exchange.

In Press Release late Thursday, the watchdog confirmed the entire amount debited from FTX’s Bahamian subsidiary, FTX Digital Markets, and added that the funds had been transferred to its own digital wallets “for safekeeping.”

The regulator previously confirmed it owns a few of FTX’s digital assets, but didn’t specify the quantity.

According to the Commission, the funds were valued at greater than $3.5 billion, based on market prices on the time of the transfer. The transfer took place on November 12, a day after FTX filed for U.S. Chapter 11 bankruptcy protection

The Bahamian Securities Commission said the funds are being held “temporarily” until the country’s Supreme Court orders them to be transferred to customers and creditors or bankruptcy estate liquidators.

The regulator said it took the funds after receiving information from Sam Bankman-Fried, the disgraced co-founder of FTX, about cyberattacks on the systems of FTX’s Bahamian unit.

FTX collapse shakes crypto to the core.  The pain may not end

It said there was a “significant risk of imminent dispersion” of assets under the control of FTX Digital Markets.

After FTX filed for bankruptcy, it became the goal of a suspicious hack that leaked $477 million from the corporate’s crypto wallets. The identity of the perpetrator isn’t yet known.

The Bahamian regulator was heavily scrutinized for its role within the collapse of FTX and subsequent lawsuits.

The Commission desired to take care of the FTX insolvency proceedings within the Bahamas. But FTX’s U.S. lawyers disputed the move, claiming it coordinated with Bankman-Fried to transfer FTX’s digital assets to its own escrow.

FTX’s U.S. lawyers denied Bahamian court-appointed liquidators access to the corporate’s computer systems, saying, “We don’t trust the Bahamian government.”

Former FTX CEO Bankman-Fried was arrested within the Bahamas and later extradited to the US to await trial on charges of fraud, money laundering conspiracy, and conspiracy to defraud the US and violate funding laws campaign.

He was released last week on $250 million bail and reportedly entertained visitors at his family home in California, including “The Big Short” writer Michael Lewis.

Bankman-Fried is predicted to be indicted and can file charges in federal court in Manhattan on January 3, in keeping with Reuters report.

(Visited 1 times, 1 visits today)