FTX says it is probing ‘abnormal transactions’ after potential hack

FTX has said it is investigating abnormal transactions after hundreds of millions of dollars worth of crytpo assets were withdrawn as the exchange declared bankruptcy.

The potential hack is the latest blow for FTX, the cryptocurrency empire once valued at $32bn and controlled by 30-year-old entrepreneur Sam Bankman-Fried, which filed for bankruptcy protection in the US on Friday.

Analysts estimated that there were more than $260mn worth of withdrawals. This was despite FTX’s previous inability to meet a surge of customer withdrawals on concerns over its financial health and links to Alameda Research, Bankman-Fried’s proprietary trading group.

The run led the founder to unsuccessfully seek billions of dollars to bail out the group.

On Saturday, the official Twitter account of FTX retweeted comments from Ryne Miller, the company’s general counsel in the US, in which he said it was “investigating abnormalities with wallet movements related to consolidation of FTX balances across exchanges”.

Outflows were estimated to be at least $266mn over the past 24 hours, according to Nansen, a Singapore-based blockchain analytics group, with $73mn withdrawn from FTX US alone.

The probe into abnormalities followed the resignation of Bankman-Fried, who until this week was one of the crypto sector’s most successful and respected figures, with an estimated net worth of $24bn.

Bankman-Fried will be replaced by John J Ray, a restructuring specialist who oversaw bankruptcy cases for Enron and Nortel Networks. Ray had said on Friday that FTX Group “has valuable assets that can only be effectively administered in an organised, joint process”.

Concerns over a potential hack were heightened after an administrator on the Telegram support group for FTX stated that “FTX has been hacked . . . Don’t go on FTX site as it might download Trojans.”