FTX Hack

FTX Hack Sees Over $500 Million In User Assets Drained From Wallets

The defunct cryptocurrency exchange FTX said on Saturday that it was looking into “unauthorized transactions” made from its accounts, a day after declaring bankruptcy. According to crypto analysts, $515 million in suspicious transfers may have been the consequence of an FTX hack or theft.

John J. Ray III, FTX’s newly appointed CEO, noted in a statement that “unauthorized access to certain assets has occurred”. He added that the company was in touch with law enforcement officials and regulators. As part of the bankruptcy process, the company has been moving its remaining crypto funds to a more secure form of storage.

The suspicious movement of funds marked a new twist in a dramatic series of events that kicked off earlier in the week. Everything began when the exchange faced a run on deposits and was unable to meet demand. On Friday, the company filed for bankruptcy, and Sam Bankman-Fried, FTX’s founder and chief executive, announced his resignation. He was replaced by Mr. Ray, a corporate turnaround specialist.

Who Does The FTX Hack Affect?

Initial indications suggested that $473 million in cryptoassets had been taken from FTX late on Friday night. According to Elliptic, a blockchain forensics company. The revelations fueled worries that FTX had been compromised as workers scrambled to get billions in digital tokens. These would eventually be used to recoup creditors in bankruptcy proceedings at the cryptocurrency business.

One of the largest operators of digital currencies pegged to the US dollar, Tether, claimed to have stepped in. It did so by freezing $31.4 million worth of the tokens it believed were being transferred by an FTX hacker.

Many cryptocurrency start-ups treated FTX like a bank as a result of the large returns it offered to businesses that held funds on its platform. This past week, the trading platform Genesis reported having $175 million in money tied up with FTX. According to a business spokesperson, the company rushed to acquire a $140 million financial injection from its parent company, Digital Currency Group.

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