FTX collapse being scrutinized by Bahamas investigators By Reuters

(Reuters) -The collapse of FTX is the topic of scrutiny from investigators within the Bahamas, who’re taking a look at whether or not any “legal misconduct occurred,” the Royal Bahamas Police stated on Sunday.

FTX filed for chapter on Friday, one of many highestprofile crypto blowups, after merchants rushed to withdraw $6billion from the platform in simply 72 hours and rival exchangeBinance deserted a proposed rescue deal.

In an announcement on Sunday, the Royal Bahamas Police stated: “In mild of the collapse of FTX globally and the provisional liquidation of FTX Digital Markets Ltd., a crew of economic investigators from the Monetary Crimes Investigation Department are working carefully with the Bahamas Securities Fee to analyze if any legal misconduct occurred.”

FTX didn’t instantly reply to Reuters’ request for a remark.

FTX’s newly appointed Chief Government John J. Ray III stated on Saturday that the corporate was working with regulation enforcement and regulators to mitigate the issue, and was making “each effort to safe all property, wherever situated.”

The change’s dramatic fall from grace has seen its30-year-old founder Sam Bankman-Fried, recognized for his shorts andT-shirt apparel, morph from being the poster baby of crypto’ssuccesses to the protagonist of the trade’s greatest crash.

Bankman-Fried, who lives within the Bahamas, has additionally been thesubject of hypothesis about his whereabouts and he deniedrumors on Twitter that he had flown to South America. When askedby Reuters on Saturday whether or not he had flown to Argentina, he responded in a textual content message: “Nope”. He advised Reuters he was within the Bahamas.

The turmoil at FTX has seen at the very least $1 billion of buyer funds vanish from the platform, sources advised Reuters on Friday. Bankman-Fried had transferred $10 billion of buyer funds to his buying and selling firm, Alameda Analysis, the sources stated.

New issues emerged on Saturday when FTX’s U.S. normal counsel Ryne Miller stated in a Twitter put up that the agency’s digital property had been being moved into so-called chilly storage “to mitigate injury upon observing unauthorized transactions.”

Chilly storage refers to crypto wallets that aren’t related to the web to protect in opposition to hackers.

Blockchain analytics agency Nansen stated on Saturday it noticed $659 million in outflows from FTX Worldwide and FTX U.S. within the final 24 hours.

In its chapter petition, FTX Buying and selling stated it has $10 billion to $50 billion in property, $10 billion to $50 billion in liabilities, and greater than 100,000 collectors. Ray, a restructuring professional, was appointed to take over as CEO.

A doc that Bankman-Fried shared with traders on Thursday and was reviewed by Reuters confirmed FTX had $13.86 billion in liabilities and $14.6 billion in property. Nevertheless, solely $900 million of these property had been liquid, resulting in the money crunch that ended with the corporate submitting for chapter.

The collapse shocked traders and prompted contemporary calls to manage the cryptoasset sector, which has seen losses stack up this yr as cryptocurrency costs collapsed.

fell under $16,000 for the primary time since 2020 after Binance deserted its rescue deal for FTX on Wednesday.

On Saturday it was buying and selling round $16,5600, down by greater than 75% from the all-time excessive of $69,000 it reached in November final yr .