The Securities Commission of The Bahamas announced Thursday that it had directed that all digital assets of FTX Digital Markets Ltd. (FDM), be transferred to a digital wallet managed by the Commission for safekeeping.
Bahamian regulators were responsible for at least some of the millions in FTX customer funds that were moved off the exchange under unusual circumstances. John Ray, FTX’s new CEO, stated:

[There is] credible evidence to suggest that the Bahamian government was responsible for directing unauthorized access into the Debtors’ systems in order to obtain digital assets of Debtors. This occurred after the commencement these cases.

The Securities Commission of The Bahamas announced Thursday that it had issued an order under existing authorities to protect clients and their funds. The Commission released the following statement in a press release:

In the exercise of its authority as a regulator under an Order by the Supreme Court of The Bahamas, the Securities Commission of The Bahamas (the Commission) directed the transfer of all digital assets of FTX Digital Markets Ltd. to a digital wallet controlled and maintained by the Commission for safekeeping. Further, urgent regulatory action was required to protect the interests and creditors of FDM clients.

FTX stated in a court filing that it had “secured only a fraction” of digital assets of the FTX group that they want to recover, and that it also has $740 million in a cold account. Decrypt reports that FTX acknowledged that they could not account for three major gaps in their tracked assets.

These balances do not include cryptocurrency that is not currently under Debtors’ control due to (a) at most $372 million of unauthorized transactions initiated on the Petition Date; (b) the dilutive “minting” of approximately $300,000,000 in FTT tokens after the Petition Date; and (c) the inability of the co-founders or potentially other to identify additional wallets believed contain Debtor assets.

On November 11, $650 million in unauthorised transfers were discovered. Many thought that this was part of a large hack targeting FTX. Ryne Miller, FTX US general counsel, said that the transfers were “unauthorised” and that the firm had begun moving its assets to cold storage in order to “mitigate the damages.”
Rumours circulated that unauthorised transfers were done by Bahamian authorities. However, The Commission issued a statement denying that. It stated that such an action could be “voidable preference” under bankruptcy rules and might have required the “clawing back of funds from Bahamian customer.”

The Commission does not condone any preferential treatment of any client or investor of FTX Digital Marketplaces Ltd. in any way.

FTX Digital markets filed for Chapter 15 bankruptcy in the United States just days after the rest FTX group filed for Chapter 11 bankruptcy. Strangely, FDM filed for Chapter 15 bankruptcy in the Southern District of New York instead of Delaware, where other companies filed their filings.
It would be an understatement to say that the FTX Group’s collapse has been bizarre, confusing, and downright confusing. Customers, investors, and all of crypto industry are left scratching their heads every day, leaving the market in disarray.

Disclaimer: This article is intended for informational purposes only. This article is not intended to be used for legal, tax, investment or financial advice.

  

The Securities Commission of The Bahamas announced Thursday that it had directed that all digital assets of FTX Digital Markets Ltd. (FDM), be transferred to a digital wallet managed by the Commission for safekeeping. Bahamian regulators were responsible for moving at least some of the FTX customer funds worth millions of dollars that were removed from the exchange in very unusual circumstances. John Ray, FTX’s new CEO, stated:
[There is] credible evidence to suggest that the Bahamian government was responsible for directing unauthorized access into the Debtors’ systems in order to obtain digital assets of Debtors. This occurred after the commencement these cases.
The Securities Commission of The Bahamas announced Thursday that it had issued an order under existing authorities to protect clients and their funds. The Commission released the following statement in a press release:
In the exercise of its authority as a regulator under an Order by the Supreme Court of The Bahamas, the Securities Commission of The Bahamas (the Commission) directed the transfer of all digital assets of FTX Digital Markets Ltd. to a digital wallet controlled and maintained by the Commission for safekeeping. Further, urgent regulatory action was required to protect the interests and creditors of FDM clients.
FTX stated in a court filing that it had “secured only a fraction” of digital assets of the FTX group that they want to recover, and that it also has $740 million in a cold account. Decrypt reports that FTX acknowledged that they could not account for three major gaps in their tracked assets.
These balances do not include cryptocurrency that is not currently under Debtors’ control due to (a) at most $372 million of unauthorized transactions initiated on the Petition Date; (b) the dilutive “minting” of approximately $300,000,000 in FTT tokens after the Petition Date; and (c) the inability of the co-founders or potentially other to identify additional wallets believed contain Debtor assets.
Many speculated that the unauthorised transfers of $650 million were part of a large hack targeting FTX. FTX US general counsel Ryne Mills labeled the transactions “unauthorised” on November 11. He also stated that the firm had begun moving its assets to cold storage to “mitigate damage.”
The Commission does not condone any preferential treatment of any client or investor of FTX Digital Marketplaces Ltd. in any way.
FTX Digital markets filed for Chapter 15 bankruptcy in the United States just days after the rest filed for Chapter 11 bankruptcy. Strangely, FDM filed for Chapter 15 bankruptcy in the United States in the Southern District of New York instead of Delaware, where the rest of FTX’s companies filed their filings. Customers, investors, and the entire crypto industry are left scratching their heads every day as more information comes to light. This article is not intended to be used for legal, tax, financial, investment, or any other advice.