© Reuters
Investing.com – The case continues to deliver new details on a regular basis, fueling the bearish pressure plaguing the cryptocurrency market as the price moves little above $16,000 and the price barely tops $1,100 this Monday morning.
Last Friday, we learned that the massive hack of the platform, during which 477 million dollars worth of cryptocurrencies were stolen the previous week, was in fact a seizure of assets orchestrated by the government of the Bahamas.
Bahamian government behind November 12 ‘hack’
The Bahamas Securities Commission admitted on Friday evening that it was behind the exchange platform that went bankrupt on November 12.
“The Bahamas Securities Commission, in exercise of its powers as regulator acting under an order of the Supreme Court of The Bahamas, has taken the step of directing the transfer of all assets from FTX Digital Markets Ltd to a commission-controlled digital wallet, for safekeeping,” the agency said in a statement.
The transfer took place the day after FTX filed for Chapter 11 bankruptcy protection in Delaware. The company had at the time confirmed the same day that “unauthorized access to certain assets had occurred” and that it was coordinating its action with law enforcement.
As early as last Thursday, US-based bankruptcy administrators led by John Ray, III, who now runs FTX, said they had “credible evidence” that Bahamian officials had asked FTX founder Sam Bankman-Fried, to access FTX’s systems after the Chapter 11 filing, “for the purpose of obtaining digital assets from debtors.”
Jurisdiction battle, FTX seeks help from other platforms to recover funds
Ultimately, therefore, it is a fight for control of jurisdiction over the bankruptcy proceedings, with the Bahamian government filing a separate Chapter 15 bankruptcy petition in federal court in New York on November 15. .
Filing a Chapter 15 petition is typically used in cases involving companies whose debtors are located in multiple countries. A hearing will take place on Monday to decide whether to combine the two cases or deal with them separately. The next day will then take place the first hearing of the bankruptcy of FTX in terms of the Delaware procedure.
It is in this context that FTX over the weekend called on its peers for help, pointing out that the siphoned funds are transferred to other entities through intermediary wallets.
The company has asked other exchanges to “take all steps” necessary to secure the funds so they can be returned as part of FTX’s bankruptcy proceedings.
Finally, not everything is to be thrown away in FTX
Finally, in what is a rare positive surprise in the context of this file, the new CEO of FTX also said on Saturday that several FTX subsidiaries appear to be financially sound.
“Based on our review last week, we are pleased to learn that many of FTX’s regulated or licensed affiliates, inside and outside the United States, have solvent balance sheets, management responsible and valuable franchises,” John Ray, FTX’s new CEO and liquidator, said in a statement.
Specifically, FTX said in a filing that there could be more than a million creditors in these Chapter 11 cases. FTX and its accountants identified 216 bank accounts, spread across 36 banks, with positive balances in the whole world. Cash balances for all entities are approximately $564 million.
Ray added that it was a “priority” in the coming weeks “to explore sales, recapitalizations or other strategic transactions regarding these subsidiaries, and others that we will identify as our work progresses” .
However, FTX indicated that it has not set a specific timeline for the completion of this process and stated that it “does not intend to disclose further developments unless and until it determines that further disclosure is appropriate or necessary.”