Cyber Attackers Are Taking Advantage Of FTX’s Bankruptcy

The cyber attackers are utilizing the current situation of the crypto market to steal the funds from the FTX platform. After the announcement of FTX filings on November 11, 2022, millions of dollars’ worth of assets from the FTX wallet were transferred to the Ethereum based tokens. Recently, Chainalysis released data that shows the funds stolen from the FTX were not sent to the Bahamas Securities Commission. Moreover, $333 million (USD) worth of FTX-related bitcoins also disappeared from the wallet.

“The claims that the funds stolen from FTX were actually sent to the Securities Commission of the Bahamas are false. Some funds were stolen, and other funds were sent to the regulators.”

On November 20, 2022, the blockchain analysis entity Chainalysis revealed a report that stated the attackers stole the FTX funds, which had to be sent to the Bahamas Securities Commission, and the stolen funds were converted from ETH to Bitcoin. Cahinalysis advised exchanges to place these tokens on hold. The entity further added that there might be a chance that an attacker can convert these stolen funds into fiat currencies.

“Funds stolen from FTX are on the move, and exchanges should be on high alert to freeze them if the hacker attempts to cash out,” Chainalysis stated.

Recently, the Bahamas’ regulators took legal action to seize the FTX’s digital assets to protect investors and users. “Urgent interim regulatory action was necessary to protect the interests of clients and creditors of FDM.”

Prior To FTX Bankruptcy, 20,000 USD In Bitcoin Was Transferred Out Of The Exchange In A Single Day

Binance CEO Changpeng Zhao (CZ) announced that the company was selling all of its FTT tokens, affecting FTX bitcoin holdings. At first, FTX held $3.3 (USD) billion worth of bitcoins, but they were dropped to 0.25 bitcoins on the platform before FTX filed for bankruptcy. In 2021, the trading volume of bitcoin on the FTX was very high, holding nearly 75,303 bitcoins. Currently, FTX has nearly 7 BTC in its wallet.

FTX, based in the United States, increased its revenue by 1,000% between 2020 and 2021. At the end of January 2022, FTX released data that shows the company completed a $400 million (USD) Services C fundraise, which resulted in increasing the valuation of FTX by up to $32 billion (USD).

At the mid of February 2022, the FTX exchange’s per-day trading volume was $10 billion (USD). But the price of cryptocurrency shows a rate of decline in 2022, resulting in a reduction of the FTX network by up to $8 billion (USD).

Is The FTX Bankruptcy Going To Affect Major Cryptocurrencies?

Arthur Hayes, co-founder of BitMex, stated that it will be a difficult task to get a bail for the FTX, maybe it will take time for users to recover their frozen funds on the FTX platform. He further added that the major cryptocurrencies like Bitcoin, Ethereum, Solana may be affected due to their price surge.

“Not your keys, not your coins. Expect all exchanges to guard their clients’ capital closely. No more taking credit from so-called crypto prime brokers. No more polite phone calls to large traders to request a margin top-up. “No mercy liquidation.”