FTX Debtors Provide Info Regarding Bahamian Crypto Seizure

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WILMINGTON, Del., Dec. 30, 2022 /PRNewswire/ — FTX Trading Ltd. (dba FTX.com) and its affiliated debtors (together, the “FTX Debtors”), today provided information about FTX debtors’ cryptocurrency under the supervision of the Bahamas Securities Commission (the “Bahamas Commission”) ).

FTX (PRNewsfoto/FTX)

On November 12, 2022, after FTX Debtors Chapter 11 business began, FTX Debtors’ cryptocurrency was transferred without their permission, including approximately 195 million FTT, 1,938 ETH, and other miscellaneous coins that did not have no substantial value. Blockchain information shows that this cryptocurrency currently resides in a single digital wallet at Fireblocks.

Based on evidence in possession of the FTX debtors, on November 12, 2022, the Bahamas Commission ordered Mr. Bankman-Fried and Mr. Wang to transfer digital assets to a Fireblocks wallet. The Bahamas Commission has acknowledged orchestrating these transfers and holding the digital assets in a single digital wallet at Fireblocks, as displayed on the blockchain.

The value of the cryptocurrency in this Fireblocks wallet at spot prices at the time of transfer was approximately $296 million, according to etherscan.io, assuming the entire amount of FTT could be sold at spot price at the time of transfer. ‘era. The value of the same cryptocurrency at spot prices as of 2:00 p.m. EST on December 30, 2022 was approximately $167 million, under the same assumption. There can be no assurance that such a quantity of TTF can be sold at spot price, if at all.

The Bahamas Commission issued a press release earlier today stating that the cryptocurrency in its custody was worth over $3.5 billion at the time of the transfer. The press release did not identify the type of cryptocurrency seized or the valuation methodology, and the Bahamas Commission did not provide FTX debtors with any further information to resolve the valuation disparity. FTX Debtors urge the Bahamas Commission to clear up any confusion created by their recent statements and provide the public with accurate information regarding the seized cryptocurrency and how it was valued for the purposes of these statements.

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Further, the FTX Debtors informed the Bahamas Commission that none of Mr. Bankman-Fried, Mr. Wang or the Bahamas Commission has the right to take cryptocurrency from the FTX Debtors and that the FTX Debtors will request the return of the seized cryptocurrency. quickly to their Chapter 11 estates for the benefit of creditors. The Bahamas Commission only regulated FTX Digital Markets Ltd. (“FTX DM”), a local service company in the Bahamas. FTX DM is not the owner or operator of the FTX.com exchange, nor the owner or custodian of the seized cryptocurrency.

More information on FTX Debtor Chapter 11 cases is available at https://cases.ra.kroll.com/FTX/.

Advisors

FTX Debtors are represented by Sullivan & Cromwell LLP as legal counsel and are assisted by Alvarez & Marsal North America, LLC as financial counsel and Perella Weinberg Partners LP as investment banker.

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