main conclusions
The lawsuits accused Bahamian officials of asking Bankman-Fired to mint new tokens and pass them on to employees The Bahamas Securities and Exchange Commission (SCB) also reacted to claims that tokens under its control were stolen are true, but anyone remotely connected to the FTX is faring badly amidst the whole disaster – and that includes the Bahamas regulation. Many startling revelations have emerged in the last month or two following the spectacular collapse of FTX. But one of the most insidious, for me at least, was that the Bahamian government worked with Bankman-Fried to mint a new token after the exchange collapsed.
Lawyers Accuse Bahamian Officials of Trying to Mint New Tokens
Lawyers for FTX said in a December court filing that Bahamian government officials asked Bankman-Fried to mint new digital assets worth “hundreds of millions of dollars,” while requesting that the disgraced CEO transfer the new tokens into control. of government officials. The report, published by Bloomberg, also outlines that Bahamian authorities worked to try to help Bankman-Fried regain access to critical computer systems on the FTX platform. Employees were “responsible for directing unauthorized access” to the systems to take control of some of the digital assets that were on the FTX platform. This was all particularly concerning as money was evidently moving on the blockchain after the FTX collapse. A reported “hack” led to $477 million worth of crypto moving in the days after the bankruptcy filing, with the hacker attempting to transfer the funds to various entities and currencies.
(1/2) Exchanges should be aware that certain funds transferred from FTX Global and related debtors without authorization on 11/11/22 are being transferred to them through intermediate wallets. — FTX (@FTX_Official) November 20, 2022
Whether this has any connection to the story about Bahamian pressure on Bankman-Fried is pure speculation and, to be clear, no evidence suggests the authorities had anything to do with it. Bahamian regulators today released a statement defending themselves against the aforementioned comments by John Ray III, the representative for US-based FTX debtors. The statement read that it “must once again correct the incorrect statements made by Mr. John J. Ray III … both in the press and in court files.” The statement highlighted that Ray’s court proceedings, which were “under oath”, were “without evidence”, strongly rebutting the allegation that officials had ordered Bankman-Fried to mint new tokens, as well as instructing “(FTX) officials to to mint $300 million worth of new FTT tokens”. He went on to dispute the claim that digital assets under the control of the Bahamas Securities and Exchange Commission (SCB) were “stolen”.
What really happened?
Indeed, it is impossible to know the ins and outs of the disaster here. But what is obvious is that this whole saga continues to get more sordid and embarrassing for cryptocurrency as a whole by the day, and anyone remotely connected to FTX looks worse and worse as time goes on. Obviously, it was a huge failure regarding Bahamian regulation, and the SCB is rightly getting hammered as a result. Whether any of the other claims are valid we have no evidence to opine on, but I’m sure time will tell. With more than a million creditors, $8 billion in lost client assets and many lives ruined, it’s hard to overstate the sadness and gravity of FTX’s plight. Now, it’s time to sort out the mess and try to figure out who exactly was wrong other than Bankman-Fried, because there’s more than enough blame to go around.
