Mysterious Outflows Exceeding $600M with “FTX Hack”

After declaring bankruptcy just hours earlier, hundreds of millions of dollars were siphoned off the cryptocurrency exchange, worsening the fall of FTX, already one of the most spectacular financial disasters in history.

Late on Friday, more than $600 million was stolen from FTX’s cryptocurrency wallets. Soon after, FTX announced that it had been compromised in its official Telegram channel and advised users not to install any new updates and to remove all FTX apps.

A hack was made on FTX. FTX apps include viruses. Take them out. The chat window is open. Don’t visit the FTX website because it could download Trojans, a chat administrator in the FTX Support channel advised. Ryne Miller, general counsel for FTX, posted the statement.

Miller revealed in a tweet hours later that due to the Friday bankruptcy, FTX US and had been transferring all of their digital assets to cold storage. After discovering unauthorized transactions, the process was sped up this evening, he said.

Many owners of FTX wallets complained that their and FTX US wallets had no balances. This could be explained by the fact that the FTX API appeared to be unavailable. On-chain data shows that a number of Ethereum tokens, as well as the Solana and Binance Smart Chain tokens, left FTX’s official wallets and transferred to decentralized exchanges like 1inch. It appears that both FTX and FTX US are impacted.

After allegedly misusing or losing billions of dollars in user funds, the company filed for Chapter 11 bankruptcy protection in the United States on the same day that the transfers took place. Online rumors began to surface, but they are merely speculation at this point, about whether an internal attack on the business might have actually been the cause.

The simultaneous and sophisticated hacks of FTX and FTX US have led some in the cryptocurrency community to theorize that the outflows may have been planned by someone in Bankman-inner Fried’s circle. They have done this by pointing out that these hacks are a sign of a possible inside job. Multiple former FTX employees confirmed to me that they do not recognize these transfers, Twitter sleuth ZachXBT wrote in a tweet on Friday night.

Although the website was still accessible, FTX’s login portal was down around midnight Eastern time, resulting in a 503 error for users trying to log in. A 503 error occurs when the server is down, usually because it is being serviced or is not accessible.

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