FTX reports $415mn in hacked crypto
Technology
FTX reports $415mn in hacked crypto
(Reuters) - Bankrupt crypto exchange FTX said in a report to creditors on Tuesday that about $415 million in cryptocurrency had been stolen in hacks.
FTX has said it had recovered over $5 billion in crypto, cash and liquid securities, but that significant shortfalls remained at both its international and US crypto exchanges. FTX attributed some of the shortfall to hacks, saying that $323 million in crypto had been hacked from FTX s international exchange and $90 million had been hacked from its U.S. exchange since it filed for bankruptcy on Nov. 11.
Indicted founder Sam Bankman-Fried later challenged aspects of the company s report in a blog post.
Bankman-Fried, who has been accused of stealing billions of dollars from FTX customers to pay debts incurred by his crypto-focused hedge fund, Alameda Research, pushed back against FTX s calculations late Tuesday, saying that the company s lawyers at Sullivan & Cromwell had presented an "extremely misleading" picture of the company s finances.
Bankman-Fried said FTX has more than enough money to repay US customers, whom he says are owed between $181 million and $497 million based on his "best guess." Bankman-Fried has not had access to FTX records since stepping down as CEO in November.
A spokesperson for Sullivan and Cromwell declined to comment. Attorneys at the firm said in a recent court filing that they have rebuffed Bankman-Fried s efforts to stay involved in the company s bankruptcy proceedings.
Bankman-Fried has pleaded not guilty to fraud charges, and he is scheduled to face trial in October.
FTX did not provide an estimate of the amount owed to FTX s US or international customers, and it did not immediately respond to questions about Bankman-Fried s blog post.
FTX provided some additional details about its recovery efforts on Tuesday, saying it had recovered $1.7 billion in cash, $3.5 billion in liquid cryptocurrency and $300 million in liquid securities.
"We are making progress in our efforts to maximize recoveries, and it has taken a Herculean investigative effort from our team to uncover this preliminary information," Ray said in a statement.
The crypto assets recovered to date include $685 million in Solana, $529 million in FTX s proprietary FTT token and $268 million in bitcoin, based on crypto prices on Nov. 11, 2022. Solana, which was lauded by Bankman-Fried, lost most of its value in 2022.
During FTX s initial investigation into hacks of its system, it uncovered a November asset seizure by the Securities Commission of the Bahamas, which led to a dispute between FTX s U.S.-based bankruptcy team and Bahamian regulators.
The two sides settled their differences in January, and Ray said on Tuesday that the Bahamian government was holding $426 million for creditors.
Bahamas Prime Minister Philip Davis referenced the dispute during a Tuesday event at the Atlantic Council in Washington, saying Ray s team had "come around" and accepted that the Bahamian asset seizure "was appropriate and perhaps has saved the day for many of the investors in FTX."
