Before the trial of Sam Bankman-Fried, the founder and former CEO of FTX, some mysterious movements of funds have added to the puzzle of the exchange’s collapse last year.
All of the 15,000 ether (ETH) from the wallet linked to the $600 million attack on FTX’s wallets last year have now been transferred using privacy tools and bridges.
In November 2022, FTX experienced a 10-day crisis from November 2nd to November 12th. It all began with a CoinDesk article and a leaked balance sheet that raised concerns. Binance, a major player, initially decided to sell all its FTT tokens due to worries about mishandled funds.
The value of FTT dropped significantly, which led many FTX customers to withdraw their money. But at the same time, other cryptocurrency platforms like Celsius Network and Voyager Digital were facing issues, which made people nervous about their investments.
When people started to withdraw their funds from the FTX exchange, which amounted to billions of dollars, Sam Bankman-Fried directed his other firm, Alameda Research, another cryptocurrency trading firm, to sell assets to cover the capital needed for these withdrawals. But whatever SBF had in mind, it became evident that the market would not recover from this large-scale withdrawal activity, and the crypto market saw a massive crash in the following days.
At one stage, Binance founder CZ Binance announced that maybe he might take over the FTX firm to stall the upcoming crisis, but after conducting their research on the feasibility of acquiring FTX, CZ saw that the mess SBF created was so huge and unethical that there was no way he would be able to clean it up and ultimately backed out from it.
It was no surprise that SBF gained the interest of the authorities overnight, and they waited no time to arrest him for crimes ranging from fraud to money laundering to election funds fraud as well.
During the same time, shortly after FTX declared bankruptcy, an unknown entity managed to get hold of $600 million worth of funds from various wallets.
Just recently, someone has managed to move 2500 ETH worth $4 million (according to the market value of Ethereum at the time this article is written) from a wallet that contains $26 million worth of Ethereum to Thorchain bridge, a Cosmos-based blockchain protocol for swapping crypto-assets like Bitcoin and Ethereum across blockchain networks.
Another transaction was made to the Railgun wallet, which is a privacy wallet that allows users to store tokens and engage in decentralized financial activities, like lending and borrowing. These transactions are private, so no one can be sure about who is involved in this activity and why.
As per estimates, addresses linked to the exploit may have moved over $32 million worth of ether using Thorchain.
These fund movements, happening just before Sam Bankman-Fried’s trial, add another layer of mystery to the collapse of FTX last year. The identity of the individuals or parties behind the attack has never been revealed.
