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In a new press release, the Securities Commission of The Bahamas explained that only placing FTX Digital Markets into liquidation was not sufficient, citing the risks associated with hacking and breach.
SCB Executive Director also lashed out at new FTX CEO John Jay Ray III for “misrepresenting” the agency’s action through the “intemperate” and “inaccurate” allegations.
Bahamas Regulator’s Statement
Its Executive Director, Christina Rolle, revealed that the Commission sought an additional order from the Bahamian supreme court for authority under the “Digital Assets and Registered Exchanges Act” to transfer all digital assets of the exchange into digital wallets under its exclusive control. This move was meant to “benefit the clients and creditors of FDM (FTX Digital Markets Ltd).”
“It is unfortunate that in Chapter 11 filings, the new CEO of FTX Trading Ltd. misrepresented this timely action through the intemperate and inaccurate allegations lodged in the Transfer Motion. It is also concerning that the Chapter 11 debtors chose to rely on the statements of individuals they have (in other filings) characterized as unreliable sources of information and potentially seriously compromised.”
The Executive Director also said that certain statements made by the purported officers of the exchange and its Chapter 11 debtors about suffering thefts and breaches further solidified the Commission’s action to secure these digital assets.
New FTX CEO on Transfer of Funds
The mysterious transfers were first detected on November 11, the same day FTX declared bankruptcy, leading to a flurry of speculation. The latest comments, however, come days after millions of dollars in FTX customer funds were moved off the exchange last week at the direction of regulators in the island nation. This assertion was made by Ray, who said in a filing,
“(There is) credible evidence that the Bahamian government is responsible for directing unauthorized access to the Debtors’ systems for the purpose of obtaining digital assets of the Debtors – that took place after the commencement of these cases.”
The company also revealed that its co-founders Sam Bankman-Fried and Gary Wang were recorded saying that regulators in the country directed the dup to conduct “certain post-petition transfers” and that such assets were “custodied on FireBlocks under the control of the Bahamian government.”
Bahamian regulators said it took these actions to protect the interests of clients and creditors under its jurisdiction.
Since the blow-up, FTX and its founders have been at the receiving end of a severe backlash. It was recently reported that the failed crypto exchange, its senior executives, as well as Bankman-Fried’s parents purchased at least 19 properties worth nearly $121 million in the Bahamas over the past two years.
The post Bahamas’ Regulator Explains Why it Made the Right Call to Seize FTX Assets appeared first on CryptoPotato.
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