FTX confirms it was hacked after going bankrupt

Cryptocurrency exchange FTX has confirmed it has identified unauthorized transfers of funds, 24 hours after the company officially declared bankruptcy. On Twitter, FTX’s Chief Legal Officer, Ryne Miller, confirmed that suspicious access to certain assets on the platform had been detected. On November 12, FTX’s Telegram channel reported a hack of the platform. The message said that “FTX has been hacked, FTX apps are malware, remove them. The chat remains open. Do not go to the official FTX website, which may contain trojans [logiciels malveillants] ».

Observers have found suspicious movements of funds from FTX wallets by analyzing blockchains. The company Elliptic, specialized in the analysis of the movements of funds of cryptocurrencies, thus evokes in a blog post released $663 million in cryptocurrency transfers from FTX-controlled wallets to several other non-exchange wallets on Friday evening on Saturday. Whether some of these transfers are considered legitimatemade as part of the company’s restructuring, others are much more suspect: Elliptic estimates the amount of funds stolen from FTX at $477 million.

John J Ray III, the company’s new Chairman and CEO, appointed after the resignation of founder Sam Bankman-Fried, said FTX teams are still analyzing the facts and have contacted the regulators and law enforcement. The Kraken exchange explains, for its part, that the perpetrators of the hack used their Kraken account to pay the fees associated with one of the fraudulent transfers, and ensures to have identified the individual responsible for this transfer, without giving the identity. On Twitter, the leader of the platform announced that he had communicated this information to the police, and leans for a “insider trading by an inexperienced person from inside FTX”.

Flash bankruptcy

FTX went bankrupt spectacularly, within a week. Valued at around $32 billion, the company fell apart when the US press revealed that company founder Sam Bankman-Fried had used billions of deposits from FTX users to fund his own crypto-financial company. Alameda, based in the Bahamas. According to wall street journal, Alameda, which was taking extremely risky financial bets, owes FTX $10 billion. And at least $1 billion taken from customer deposits has disappeared, according to Reuters. FTX filed for bankruptcy on November 11.

Read also: Article reserved for our subscribers FTX, the bankruptcy that shakes cryptocurrencies

There is great confusion over the amount of funds remaining, and their availability. At the end of last week, FTX announced that it had reopened withdrawals, only for its customers residing in the Bahamas, by order of the local regulator. On Sunday, this same regulator denied having ordered such a measure. Several financial regulators, including the powerful US Securities and Exchange Commission, have opened investigations into FTX’s bankruptcy.

Sunday, Binance and Huobi, two of the leading platforms specializing in the trading and exchange of cryptocurrencies, suspended deposits of FTT tokens, the tokens created by FTX, and whose price collapsed last week, losing more than 90% of their value. FTX regularly generated new tokens, but as of the start of the day, 192 million tokens had been generated, without warning and outside of the usual schedule, suggesting manipulation. In Hong Kong, AAX, another major exchange, has suspended withdrawals for ten daysexplaining that they have no connection with FTX but wish to avoid any risk of fraud.

Monday, November 14, Changpeng Zhao, the CEO of the number one exchange, Binance, announced the launch of a “support fund” intended for “help projects that are strong but facing a cash crisis”. Mr. Zhao has not yet given any details on this project; the bankruptcy of FTX led to sharp drops in the price of almost all cryptoassets, before a slight rebound at the start of the week.

The personal situation of key FTX executives is also the subject of intense speculation. During the weekend, the specialized press had mentioned attempts to escape abroad of certain company executives, to Hong Kong or Dubai, countries that do not have an extradition treaty with the United States.

Read also: FTX: Binance, one of the biggest cryptocurrency platforms, gives up trying to save its sinking rival

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