Wednesday, 07 Dec 2022

At least $1bn in investor assets missing after FTX collapse reports

At least $1bn in investor assets missing after FTX collapse reports


At least $1bn in investor assets missing after FTX collapse  reports

Amid the fallout of the implosion of FTX, once the second-largest cryptocurrency exchange, at least $1bn in investor assets appears to be missing, according to multiple reports.

On Saturday morning, Reuters reported that FTX was missing at least $1bn in client funds, according to two anonymous sources who held senior positions at FTX and said they had been briefed on the company's finances. The sources claimed the funds were part of $10bn in client funds that the FTX founder, Sam Bankman-Fried, secretly transferred to Alameda Research, the hedge fund he owns.

The moving of FTX funds to Alameda was one of a series of crises that led to FTX filing for bankruptcy and Bankman-Fried's resignation on Friday.

Bankman-Fried told Reuters that he "disagreed with the characterization" of the transfer, saying: "We had confusing internal labeling and misread it."

When asked about the missing customer funds over text message by Reuters, Bankman-Fried replied with: "???"

Separately, in a tweet on Saturday, FTX's US general counsel, Ryne Miller, said that the company had detected "unauthorized transactions" and that it had moved all digital assets to cold storage, or offline, as a precaution. Elliptic, a cryptocurrency analytics and compliance firm, estimates that $473m in crypto assets were stolen from FTX last Friday night, though the specific amount has not been confirmed.

Bankman-Fried, 30, was hailed as a crypto titan until the descent of FTX over the last week. He was a major donor to the Democratic party, with a net worth that was once $17bn, and had goals of shaping how the world, especially policymakers in Washington DC, saw cryptocurrency.

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