(Commonwealth Union)_The fall of FTX, which was already one of the most spectacular financial disasters in history, exacerbated as hundreds of millions of dollars were taken from the cryptocurrency exchange hours after it declared bankruptcy.
Late Friday, more than $600 million was stolen from FTX’s crypto wallets. Soon after, FTX announced in its official Telegram channel that it had been hacked, advising users not to install any additional updates and to remove all FTX apps. “FTX has been hacked. FTX applications are malware. Delete them. Chat is open. Don’t go on FTX site since it may download Trojans,” an account administrator posted in the FTX Support Telegram chat. The tweet was pinned by FTX General Counsel Ryne Miller.
Miller subsequently announced in a tweet that owing to the Friday bankruptcy, FTX US and FTX.com had been transferring all of their digital assets to cold storage. “The process was sped up this evening – to limit harm after identifying illegal transactions,” he stated.
Many FTX wallet users reported having no funds in their FTX.com and FTX US wallets. The FTX API appears to be down, which could explain this. On-chain data show that several Ethereum tokens, as well as Solana and Binance Smart Chain tokens, have left FTX’s official wallets and gone to decentralised exchanges such as 1inch. Both FTX and FTX US appear to be affected.
The transfers took place on the same day that the company filed for Chapter 11 bankruptcy protection in the United States, allegedly after losing or misappropriating billions of dollars in customer payments. Suspicions – which are still speculative at this time – have surfaced online regarding whether, rather than an outside attack, someone within the company was responsible.
On Twitter, many of the cryptocurrency community suggested that the outflows could have been orchestrated by a member of Bankman-inner Fried’s circle, citing the simultaneous and sophisticated hacks of FTX and FTX US as proof of a probable inside operation. “Several former FTX employees confirmed to me that they do not recognise these transfers,” according to Twitter sleuth ZachXBT.
Around midnight Eastern time, FTX’s login portal became offline (though the site remained operational), resulting in a 503 error when users attempted to log in. A 503 error happens when the server is offline, most commonly due to maintenance or being inaccessible.
