The Bahamas Securities Commission confirmed that it had instructed Sam Bankman-Fried to turn over the assets of the exchange to the government. The Bahamian agency is now one of the world’s largest holders of ETH after ordering the FTX hack.
FTX “Hack” order from Bahamas Government to SBF!
Bahamian authorities have ordered Sam Bankman-Fried, the main figure of the previously crashed FTX exchange, to transfer hundreds of millions of dollars in cryptocurrencies from FTX to a wallet controlled by the Bahamas Securities Commission. The commission confirmed in a press release Thursday that it had ordered the transfer. The Commission said in a statement that on November 12, authorities “instructed that all digital assets of FTX be transferred to a Commission-controlled digital wallet for safe keeping.” In the memo, he also stated that he had ordered FTX to move assets “to protect the interests of customers and creditors.”
FTX collapsed after a bank run and liquidity crisis that shook the entire crypto ecosystem. He then filed for bankruptcy under Chapter 11 on November 11. After customers’ withdrawals were frozen, it was revealed that the exchange had a $9.4 billion hole in its balance sheet because it lent client funds to Alameda Research, a trading firm founded by Bankman-Fried.
A filing from FTX on November 17 shows that the Bahamian government directed Bankman-Fried to transfer the funds. Accordingly, he argues that SBF obtained ‘unauthorized access’ to FTX’s systems.
Bahamas authority becomes 35th largest Ethereum whale
cryptocoin.comAs you follow, FTX suffered a hack on November 12 that caused more than $600 million in losses. In this attack, FTX suffered from a suspected ‘hack’ in which crypto assets were moved to external wallets. FTX USA General Counsel Ryne Miller made a statement after the incident. In this context, it confirmed that some assets were moved to cold storage ‘to mitigate damage’.
After the assets were transferred, they were exchanged for ETH. Blockchain security firm Beosin estimates that the Bahamian authority has more than $330 million in cash. This makes it the 35th largest Ethereum whale. Most of the funds are currently held in this Ethereum wallet. Whether the commission will respond appropriately is a matter for the court to decide. However, the announcement sparked controversy within the crypto community.
In FTX’s filing, he added that “remaining on auto-stop has been exhibited by at least one government actor.” Under US bankruptcy law, the automatic stop provided in Chapter 11 is a period of suspension of all proceedings, collection activities, liens, and recovery of property. However, the funds were moved a few hours after Chapter 11 was filed. Given this situation, the Commission and FTX seem to have overlooked this rule.
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