Criminal Investigation Against Bankrupt FTX Exchange

Senator and minister for legal affairs, Ryan Pinder, has reassured investors and tourists that The Bahamas was a safe place for both travel and business. In his 23-minute pre-recorded speech, he addressed the FTX collapse and also spoke about the action taken by the Bahamas government

“The Securities Commission, our financial intelligence unit, and the financial crimes unit of the Royal Bahamas police force will continue to investigate the facts and circumstances regarding FTX’s insolvency crisis and any potential violations of Bahamian law,” Pinder said, speaking about the actions taken against FTX. 

The majority of Pinder’s speech was him trying to make a point that The Bahamas’ regulatory framework was adequate to regulate the cryptocurrency industry. He further said that there are no international norms for cryptocurrency regulation and that no other authority could act as swiftly as the Securities Commission. 

He further also stated that he was shocked by the ignorance of individuals who claimed that FTX chose to relocate to the Bahamas in order to avoid regulatory scrutiny.

Alameda Research is not registered in the Bahamas

While Pinder asserted that FTX was a legal company in the Bahamas, he also said that Alameda Research lacked the authorization to conduct any sort of business there. Alameda would also be subject to regulations if it is discovered that the corporation has committed any improprieties.

Despite some claims to the contrary, it has also been asserted that Sam Bankman-Fried and Alameda engaged in leveraged arbitrage transactions worth up to $25 million each day. A large number of Alameda-related portfolio firms is highlighted on the website crunchbase.com. 

In addition, on Nov. 2, 2022, Coindesk reported Alameda’s financial sheet in which they noticed that, in contrast to other assets held by the corporation, Alameda retained a chunk of FTX (FTT) tokens.

Conclusion

The cryptoverse is still in shock as a result of the FTX meltdown. The exchange’s balance sheet has a $6 billion hole after its liquidity crisis. The company filed for Chapter 11 bankruptcy procedures on November 11. Shortly after, Sam Bankman-Fried, the creator of FTX, announced his resignation, handing the reins to John J. Ray III as the new CEO.