FTX Collapse: Security Regulators of the Bahamas released order for the transfer of FTX Digital Assets

If you have seen the news, FTX has been one of the top headlines for you. With the year 2022 already encountering the crypto winter since the crypto market crash in May, and the FTX collapse that started at the beginning of November, took the crypto world by storm. The manipulated balance sheet from the FTX did not only affect the customer funds but had also affected a lot of VCs. To give a quick recap of what happened till the FTX filed for chapter 11 bankruptcy is as mentioned below.

TIMELINE OF THE FTX COLLAPSE: IN BRIEF

Read in detail about the FTX Collapse

The hacking incident that soon followed once Binance pulled out from its FTX deal saw millions drained from the exchange. Soon after this, the Securities Commission of The Bahamas also referred to as SCB said that as a step, SCB had ordered the transfer of all digital assets of FTX Digital Markets (FDM) to a digital wallet that is owned by the commission on November 12, 2022.

Securities Commission of The Bahamas Assumes Control of Assets of FTX Digital Markets Ltd. pic.twitter.com/IzW4PGZSJm

— Securities Commission of The Bahamas (@SCBgov_bs) November 18, 2022

Last week’s move by the SCB, was justified by stating that “urgent interim regulatory action was necessary to protect the interests of clients and creditors of FDM.” Following the FTX collapse, some of the crypto community people flagged some suspicious transactions in wallets that were tied to FTX and FTX.US. Soon many analysts reported that around $663 million have been drained. Of the drained amount, about $477 million of it was suspected to be stolen while the remainder was believed to have been moved to secure storage by FTX themselves.

However,the SCB statement did not make any mention of how much of the FDM’s digital assets were moved as a result of this order.

According to the CoinDesk report, the FTX attorneys said in their filling, “The filing of the Chapter 15 Case without advance notice and in the SDNY is a blatant attempt to avoid the supervision of this Court and to keep FTX DM isolated from the administration of the rest of the Debtors, which constitute the vast majority of the remainder of the FTX group. Under normal circumstances, that would be inappropriate and grounds for transfer to this Court. But these are not normal circumstances.”

Source: CoinDesk, CoinTelegraph

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