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FTX bankruptcy, theft overview:
- Who: Cryptocurrency exchange FTX is investigating an apparent theft of $500 million worth of assets.
- Why: The FTX theft apparently happened after the company filed for Chapter 11 bankruptcy after losing $32 billion in value.
- Where: Cryptocurrency investors nationwide used FTX.
Cryptocurrency exchange FTX is investigating what it says appears to be a theft of around $500 million dollars of assets following its decision to file for Chapter 11 bankruptcy.
FTX’s general counsel says it was investigating what it called “unauthorized transactions” that occurred on the embattled cryptocurrency exchange, Law360 reports.
FTX reportedly says it has moved its digital assets to “cold storage” to minimize the damage from the apparent hacking incident.
The FTX theft comes after the company filed for Chapter 11 bankruptcy in Delaware while claiming at least $10 billion in total liabilities, Law360 reports.
FTX reportedly needed to file for Chapter 11 bankruptcy after the company failed to secure the liquidity needed to offset its unexpected recent collapse in value.
Sam Bankman-Fried, the founder and CEO of FTX, resigned from his position with the company prior to the bankruptcy filing, Law360 reports.
FTX froze customer withdrawals following erasure of $32 billion in value
FTX’s collapse reportedly began on Nov. 6 after investors attempted to withdraw nearly $6 billion from their accounts after the company’s lending relationship with Bankman-Fried-founded cryptocurrency hedge fund Alameda Research became known.
The company froze customer withdrawals on Nov. 8, while FTX’s collapse led to the erasure of $32 billion in value on Nov. 9, Law360 reports.
Cryptocurrency exchange Binance reportedly initially made an offer to purchase FTX but changed its mind after looking into the company.
In other crypto news, the U.S. Department of Justice announced earlier this month that it seized $3.36 billion worth of cryptocurrency assets that had been stolen 10 years ago from the Silk Road dark web marketplace.
What do you think of the FTX bankruptcy and theft? Let us know in the comments!
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3 thoughts onFTX cryptocurrency exchange files for bankruptcy, investigates $500M theft
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