FTX says $415 million worth of cryptocurrencies have been hacked

Jan 17 (Reuters) – Bankrupt cryptocurrency exchange FTX said in a report to creditors on Tuesday that about $415 million worth of cryptocurrencies had been stolen in hacking attacks.

About $323 million in cryptocurrencies have been hacked by the international FTX exchange and $90 million by the U.S. exchange since it filed for bankruptcy on Nov. 11, CEO John Ray said on Tuesday in a separate statement.

FTX founder Sam Bankman-Fried has been accused of stealing billions of dollars from FTX clients to pay off debts incurred by his cryptocurrency-focused hedge fund, Alameda Research. Bankman-Fried pleaded not guilty to fraud charges.

FTX told a Delaware bankruptcy judge last week that it had recovered more than $5 billion in cryptocurrencies, cash and liquid securities, nine weeks after filing for bankruptcy.

The company provided more details on Tuesday, saying it recovered $1.7 billion in cash, $3.5 billion in liquid cryptocurrency and $300 million in liquid securities.

FTX did not provide an estimate of total liabilities, but said it had identified major significant shortcomings both in its international cryptocurrency exchanges and in the United States.

“We are making progress in our efforts to maximize recoveries and it has taken a herculean investigative effort by our team to uncover this preliminary information,” Ray said in the statement.

Crypto assets recovered to date include $685 million in Solana, $529 million in FTX’s proprietary FTT token, and $268 million in bitcoin, based on cryptocurrency prices as of Nov. 11, 2022. Solana, which was commended by Bankman -Fried, lost most of its value in 2022.

During FTX’s initial investigation into hacks to its system, it uncovered a November asset seizure by the Securities Commission of the Bahamas, which led to a dispute between FTX’s US-based bankruptcy team and law enforcement officials. regulation of the Bahamas.

The two sides settled their differences in January, and on Tuesday Ray said the Bahamian government held $426 million for creditors.

Bahamian Prime Minister Philip Davis referred to the controversy during a Tuesday event at the Atlantic Council in Washington, saying Ray’s team had “come around” and agreed that the seizure of Bahamian assets “was appropriate and perhaps saved the day for many of the investors in FTX.”

Reportage by Dietrich Knauth in New York and Jasper Ward in Washington Editing by Noeleen Walder, Amy Stevens and Matthew Lewis

Our standards: the Thomson Reuters Trust Principles.

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