Late Friday evening, it was confirmed that a total sum of about $10 billion was moved from FTX into Alameda Research by Sam Bankman Fried (SBF). The suspicious transactions in the wallets indicated that between $1-2 Billion in client funds had gone missing. When SBF was questioned  regarding the missing $1-2 billion, his response was “???”Crunching the numbersUpon reviewing blockchain transactions, FTX’s wallet address was shown to have received a total of $105.3 million worth of Ethereum, Solana, and BNB tokens from international and US-based wallets since 9:20 ET on Nov. 11.Keeping a thoroughly documented Twitter thread of the ongoing transactions at the time, Foobar publicly followed the cash flow as it occurred.Hundreds of millions of dollars are now flowing out of FTX wallets, some speculate liquidators but it’s late on a friday night, not typical times for such rapid heavy movements. Some withdrawals are being made from Tether to DAI. Hack or insider actions? $26 million here— foobar (@0xfoobar) November 12, 2022The FTX wallet swapped $16 million USDT for DAI through the decentralized exchange, 1inch, after Tether blacklisted their USDT. The address then approved USDT LINK and sETH. It also sold USDT andETH. According to on-chain data, the same address also purchased millions of LIDO on CowSwap. Miller added that the process was sped up to mitigate the damage of the unauthorized transactions observed.Following the Chapter 11 bankruptcy filings – FTX US and FTX [dot] com initiated precautionary actions to move all digital assets to cold stock. Process was expedited this evening – to mitigate damage upon observing unauthorized transactions.— Ryne Miller (@_Ryne_Miller) November 12, 2022Just over two hours later, Bitcoin Archive tweeted the breaking news that “FTX had a “backdoor” built into its accounting software by SBF.” This route was used to move assets in the billions of dollars without triggering alerts to staff and external auditors.BREAKING: FTX had a “backdoor” built into its accounting software by SBF, which he used to move billions without triggering alerts to other staff, auditors etc – Reuters— Bitcoin Archive 🗄🚀🌔 (@BTC_Archive) November 12, 2022The “backdoor” was established using bespoke software, granting SBF the ability to execute commands enabling him to alter company financial records without notifying anyone.Furthermore, using this “backdoor” to move the $10 billion to Alameda avoided triggering both accounting red flags and internal compliance.Potential legal implicationsFTX is under investigation by the U.S Securities and Exchange Commission (SEC) regarding the management and handling of client funds. FTX now has more questions as the SEC investigation continues. FTX announced Friday that John J. Ray III, a renowned restructuring expert, will take over control of the company. Ray III handled the liquidation of Enron Corp — a company recorded as one of the world’s largest bankruptcies.Get an Edge on the Crypto Market 👇Become a member of CryptoSlate Edge and access our exclusive Discord community, more exclusive content and analysis. Analyse of the chain Price snapshots More context Register now for $19/month to enjoy all the benefits

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