FTX Is Probing Possible System Intrusion After Filing for Bankruptcy

FTX, the most recent collapsed cryptocurrency exchange, is reportedly conducting an investigation into a probable breach involving hundreds of millions of dollars worth of crypto assets that seem to have vanished from its accounts.

Unanswered Questions

Based on a report by CNET, the precise worth of the crypto funds that may allegedly be missing is a mystery. Several media sites have reported varying amounts.

Nonetheless, a number of the claims have cited Elliptic, a company that specializes in researching cryptocurrencies. According to a post made by Elliptic on Saturday night, Nov. 12, regarding the potential theft, the amount was estimated to be close to half a billion dollars.

The New York Times reported that the specifics of the possible theft incident are unknown.

Sam Bankman-Fried, the former CEO of the exchange, sent the outlet a text message stating that they are working with the bankruptcy team to sort it out.

The article by The New York Times said that since FTX has already lost billions of dollars due to the bankruptcy, such a significant theft would make it far more difficult for the firm to reimburse consumers and other creditors.

When cryptocurrencies get stolen, the perpetrators often have a tough time turning them back into cash they can use. Since the records of the crypto transactions are public, specialists can monitor the flow of money and acquire information that may lead them to the names of the offenders.

Kraken's Relevance

Rumors about the strange FTX cash transfers propagated on Twitter.

When there were claims that someone engaged in the movement of assets had an account on Kraken, another digital asset exchange, its CEO, Nick Percoco, tweeted, "We know the identity of the user."

Ryne Miller, who serves as general counsel for the FTX operation in the US, promptly responded to the said Twitter post. "Interested in anything you are open to share. Could you reach out to me?"

The Fall of FTX

The sustainability of FTX's operation came into doubt on Friday, which led to the company's decision to seek protection under bankruptcy laws.

CEO Sam Bankman-Fried resigned and was replaced by John J. Ray III, a corporate turnaround expert.

According to The New York Times, authorities are looking into whether or not Mr. Bankman-Fried should face criminal charges after the collapse of his cryptocurrency exchange.

Following this unfortunate event, the crypto lending firm BlockFi, in which Bankman-Fried invested, announced its suspension of services this past week.

The cryptocurrency Solana, which he actively supported, has seen its value plummet. In addition, Bankman-Fried's organization staff, known as the FTX Future Fund, has resigned.

The collapse of the exchange, which had been one of the most significant participants in the cryptocurrency industry, has cast doubt on crypto in general and caused clients to question whether or not they would ever see their money again, as reported by The Wall Street Journal.

This article is owned by Tech Times

Written by Trisha Kae Andrada