FTX lawyer says a substantial amount of crypto assets are missing or stolen

The crypto exchange sponsored the FTX Arena in Miami, Florida.

A substantial amount of assets tied to FTX are either missing or stolen, a company lawyer said. 
In a bankruptcy hearing, the lawyer said FTX initiated cyberattack controls in response. 
He added the exchange was controlled by “inexperienced and unsophisticated individuals.” 

A lawyer for FTX said a substantial amount of assets belonging to the bankrupt crypto exchange were either missing or stolen, The Wall Street Journal reported. 

In a Tuesday bankruptcy hearing, Sullivan & Cromwell restructuring partner James Bromley said FTX was controlled by “inexperienced and unsophisticated individuals, and some or all of them were compromised.”

“What we have here is a worldwide, international organization, but which was run as a personal fiefdom of Sam Bankman-Fried,” Bromley added. 

His comments come after the collapse of FTX, which filed for bankruptcy earlier this month following a severe liquidity crisis, in what Bromley described as “one of the most abrupt and difficult collapses in the history of corporate America and the history of corporate entities around the world.” 

The collapse shocked crypto investors given Bankman-Fried was viewed as a white knight of the sector after he bailed out two platforms earlier this year following a market sell-off. Now, prosecutors in New York and the Securities and Exchange Commission are investigating FTX’s crash amid allegations that Bankman-Fried mishandled client funds. 

Bromley said FTX was in “constant communication” with the US Department of Justice and the cybercrimes unit of the US attorney’s office in Manhattan over the missing assets, per The Journal. He added that FTX had stepped up efforts to try to protect the exchange from any cyberattacks. 

In another sign of how widespread FTX’s collapse could be, the crypto exchange said it may have more than 1 million creditors after initially saying the …read more

Source:: Businessinsider

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