Bahamian authorities seized $3.5 billion in FTX assets

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The Bahamian securities regulator announced on Thursday that it seized $3.5 billion in digital assets controlled by FTX Digital Markets (FTXDM) on November 12.

Why it matters: One million people have reportedly received money in cryptocurrency and traditional forms from the failed cryptocurrency exchange. Its remaining funds are now split between the company and the regulator that previously oversaw it on behalf of the island nation.

What they say: The statement from the Bahamas Securities Commission first details the process it followed to act under the authority of national courts, then it says, “The Commission…has taken the ordering the transfer of all digital assets in the custody or control of FTXDM or its principals, valued at over US$3.5 billion, … to Commission-controlled digital wallets, for the keep.

It does not detail which crypto assets were seized. All of the more volatile assets, such as bitcoin, will have lost considerable value since November 12. Stablecoins such as tether or dai would have roughly the same value as them.

Of note: FTX’s new management announced on Nov. 20 that it had access to approximately $1.2 billion in cash, with approximately $3.1 billion in debt.

Around the same time, approximately $372 million in digital assets appear to have been stolen from FTX, which is currently under investigation by the Department of Justice.

Zoom out: Tension has erupted between the Caribbean regulator and new FTX management.

Each side seems to want a major concession from the other. Bahamian authorities would like to have access to FTX’s records in order to conduct their own investigation, while FTX’s new management would like to take custody of the crypto assets currently managed by the island nation.

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