A day after Sam Bankman-Fried’s digital asset empire filed for Chapter 11 protection, the former cryptocurrency mogul was interviewed by Bahamian police.
A day after Sam Bankman-Fried’s digital asset empire filed for Chapter 11 protection, the former cryptocurrency mogul was interviewed by Bahamian police and regulators, according to a person familiar with the matter.
Analysts say that around $662 million worth of tokens mysteriously flowed out of FTX’s US and international exchanges. FTX had started moving some of its assets to offline wallets and then expedited those moves “to mitigate the damage by looking at unauthorized transactions,” according to the US platform’s general counsel, Ryne Miller.
According to investment materials seen by the Financial Times, FTX Trading International had just $900 million in liquid assets on Thursday versus $9 billion of liabilities.
Former Treasury Secretary Lawrence Summers compared the collapse to the demise of energy company Enron Corp. The Securities and Exchange Commission and the Commodity Futures Trading Commission are investigating whether FTX mishandled customer funds, according to people familiar with the matter.
(All time references are New York)
Binance is Halting FTX FTT Token Deposits (3:30am)
Binance has halted deposits of FTT, the FTX token, “to prevent the possibility of further questionable supply impacting the market,” Binance CEO Changpeng “CZ” Zhao said on Twitter. Zhao said that he would encourage other exchanges to do the same. Justin Sun said that Huobi Global would echo Zhao’s advice.
Zhao added that FTT contract implementers moved all remaining FTT supplies worth $400 million, “which should be unlocked in batches.” Binance went on to say that he had noticed a “suspicious movement” of a large amount of FTT by token contract implementers.
FTT fell as much as 21% on Sunday to $1.65, although it had recovered to around $2 by 8:26am in London.
Matrixport says 79 customers affected by FTX are not at risk of insolvency (11:38 pm)
Crypto financial services platform Matrixport “continues to operate as normal and the company is not at risk of insolvency regarding developments at FTX and Alameda,” according to Ross Gan, head of public relations.
Matrixport had 79 clients who suffered losses through exposure to three products on its platform that were linked to FTX, Gan said.
Kraken freezes accounts possibly related to FTX (11:33 pm)
Crypto exchange Kraken said it has frozen Kraken account access to certain funds it suspects are associated with “fraud, negligence, or misconduct” related to FTX. Kraken said in a tweet that he is in contact with law enforcement and plans to resolve each account on a case-by-case basis.
Bankman-Fried interviewed by police in the Bahamas (9:42 pm)
Former cryptocurrency mogul Sam Bankman-Fried was interviewed by Bahamian police and regulators on Saturday, according to a person familiar with the matter. Bankman-Fried did not immediately respond to a request for comment.
The inquiries from Bahamian authorities add to the mounting legal pressure Bankman-Fried has faced since his FTX empire collapsed last week. In the US, it faces scrutiny from the Securities and Exchange Commission on whether it violated securities rules.
Bahamas says it did not authorize local withdrawals by FTX Exchange (9 pm)
The nation’s securities regulator has questioned bankrupt crypto exchange FTX’s decision to allow withdrawals in the Bahamas.
The Bahamas Securities Commission in a statement on Saturday said it had not “directed, authorized or suggested” the prioritization of local withdrawals to FTX Digital Markets Ltd.
He added that such withdrawals could be recovered.
Jump Crypto Says It Remains Well Capitalized After FTX Exposure (5:59pm)
Jump Crypto, a cryptocurrency trading firm, told clients on Saturday that it remains “well capitalized” after the FTX exposure. In a series of tweets, Jump said its exposure was “managed in accordance with our risk framework.” The company did not specify the exact nature of its exposure to Sam Bankman-Fried’s collapsed digital asset empire. Jump’s guarantee comes after FTX was hit by a mysterious outflow of around $662 million worth of tokens.
FTX to Seek Compliance Assistance for Unauthorized Withdrawals (1:46 pm)
FTX is launching an investigation with the police into unauthorized withdrawals from some of its crypto wallets, a company executive has said. The company, which filed for bankruptcy this week, said it is cooperating and coordinating with “police and relevant regulators.”
Liabilities Liquid Assets Dwarfed: FT (1:13 pm)
FTX Trading had $900 million in liquid assets against $9 billion of liabilities the day before the bankruptcy filing, the Financial Times reported, citing investment materials and a spreadsheet the newspaper had seen. Most of the registered assets are illiquid venture capital investments or crypto tokens that are not widely traded. The largest asset as of Thursday was listed as worth $2.2 billion in a cryptocurrency called Serum.
Some FTX staff leave for HK: Semafor (11:55 am)
Engineers and traders working at FTX and Alameda Research in the Bahamas, where the crypto exchange is based, have left for Hong Kong and elsewhere, Semafor reported, citing people close to current and former FTX-based employees. Caribbean. Bankman-Fried and most of her inner circle are still in the Bahamas, according to the report.
Kraken will help investigate unauthorized withdrawals (11:51 am)
Crypto exchange Kraken said it knows the identity of an attacker who made unauthorized withdrawals from rival platform FTX. The perpetrator moved some funds from a Kraken account to the wallet he was using to store some stolen tokens on Saturday, blockchain security firm Hacken.io said, citing transaction data. Kraken was then able to identify the attacker by checking his platform for data on the original address, his chief security officer, Nick Percoco, said in a tweet.
Crypto Markets Take a Breath (9:16 am)
The price of the two largest tokens by value, Bitcoin and Ether, were largely unchanged on Saturday, with crypto asset prices largely flat, as traders assess their next moves following this week’s market sell-off and the collapse of FTX, once the largest trading platforms in the industry. “We are in the midst of another deleveraging event in the crypto ecosystem and so far it is having a limited spillover effect on broader equity markets beyond sentiment as crypto institutions lent to each other,” Morgan Stanley analysts said. in a note on Friday.
Yellen says the debacle demonstrates the need for regulation (5:48 am)
US Treasury Secretary Janet Yellen said FTX’s implosion “shows the weaknesses” within the sector and that the digital asset market required “very careful regulation.” She added that digital assets are not currently a threat to the financial system as a whole.
FTX hit by mystery outflow of around $662 million (3:03 am)
Blockchain analytics firm Nansen, which gave an overall estimate of $662 million in withdrawals, said the coins came out of FTX’s international and US exchanges. Elliptic said that initial indications show that nearly $475 million in illicit transactions were stolen, and that the stablecoins and other tokens that were taken were quickly converted to Ether on decentralized exchanges, “a common technique used by hackers to avoid seize their loot.”