Dec. 30 (UPI) — The Securities Commission of the Bahamas said it has taken possession of $3.5 billion worth of cryptocurrency from the collapsed exchange FTX for “safekeeping” until it receives guidance from its courts.
The commission said late Thursday the funds were moved from the FTX Digital Markets to its own digital wallet on Nov. 12, the day after FTX filed for bankruptcy protection in the United States.
The financial watchdog said it took the action after Sam Bankman-Fried, FTX’s embattled co-founder, warned them of cyberattacks on its systems.
“The commission determined that there was a significant risk of imminent dissipation as to the digital assets under the custody or control of FTXDM to the prejudice of its customers and creditors,” the SCB said in a statement.
“As a result, in the exercise of its regulatory powers, the Commission requested and obtained a court order to safeguard the digital assets owned by or under the custody or control of FTXDM or its principals by transferring them to secure digital wallets under the exclusive control of the commission.”
The news comes a day after the fraud and money laundering case against Bankman-Fried was reassigned to a new judge after the formerly appointed judge recused herself over a possible conflict of interest.
Judge Ronnie Abrams of the U.S. District Court for the Southern District of New York removed herself from the case last week because her husband is a law partner in a firm that worked with FTX previously.
U.S. District Judge Lewis Kaplan will now hear the case. Kaplan has presided over a number of high-profile cases in recent years, including a defamation lawsuit brought against former President Donald Trump by E. Jean Carroll.
