Bahamas Securities Commission Holds FTX Users’ Assets Temporarily

Bahamas regulator holding FTX assets on a temporary basis.
FTX Japan is planning to return users’ assets.
Some of the FTX users are selling their claims at steep discounts.

As per a December 29 statement, the Bahamas Securities Commission took control of $3.5 billion worth of FTX funds. The Commission decided to hold the assets temporarily after FTX filed for Chapter 11 bankruptcy to protect the exchange from cyber attacks. The Commission said former FTX CEO Sam Bankman-Fried and Gary Wang no longer have access to the frozen assets.

Christina Rolle, the Commission’s CEO, said, “All transferred assets were and remain under the sole control of the Commission.”

The Bahamas Supreme Court will direct the Commission to credit the customers’ funds who own them under rules governing the insolvency estate for the customers’ benefit. To protect the interest of investors and users of the platform, the Commission said it would continue a “diligent investigation” on the recent crypto exchange downfall.

“On November 12, the Commission took the action of directing the transfer of all digital assets under custody, valued at more than $3.5 billion, based on market pricing at the time of transfer, to digital wallets controlled by the commission, for safekeeping.”

After the announcement of FTX’s bankruptcy filings on November 11th, 2022, millions of dollars worth of assets from the FTX wallet were transferred to the Ethereum-based tokens. According to the FTX bankruptcy filings, nearly $372 million worth of assets were stolen from the firm.

FTX Japan is planning to return users’ assets

FTX Japan is trying to develop a platform that helps users to withdraw their assets through the website of ‘Liquid Japan,’ which will be announced in February 2023.

FTX Japan said, “We deeply apologize for the big trouble caused by the prolonged suspension of services for the withdrawal of legal currency as well as crypto assets.”

Users are selling their FTX claims at steep discounts

Investors are afraid to make a move on cryptocurrency after facing huge losses in the recent FTX collapse. The users of FTX are selling their claims at very low prices to avoid the lengthy bankruptcy process.

As per The Wall Street Journal, users are showing interest in selling their claims via Cherokee Acquisition, an investment banking institution.

Earlier, leading credit investment firms are trying to purchase claims from FTX’s users. Apollo Global Management and Attestor are in the race to buy claims. Niche investment firm 507 Capital recently bought several claims from hedge funds.

Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing