FTX Said to Have Confirmed Hacking Reports, Investigating 'Unauthorised Transactions'

FTX officials appeared to confirm rumours of a hack on the firm's Telegram channel.

By Reuters | Updated: 12 November 2022 16:58 IST

FTX Said to Have Confirmed Hacking Reports, Investigating 'Unauthorised Transactions'

FTX, other affiliated companies filed for bankruptcy court protection from creditors in Delaware

Highlights

FTX expediting process of shifting all digital assets into cold storage
Cold storage refers to crypto wallets that are not connected to internet
FTX struggled to raise money as traders withdrew crypto tokens

Collapsed crypto exchange FTX said on Saturday it was moving funds into offline storage following a series of "unauthorised transactions", with analysts saying millions of dollars worth of assets had been withdrawn from the platform.

FTX US general counsel Ryne Miller said in a tweet on Saturday that the exchange was expediting the process of shifting all digital assets into cold storage "to mitigate damage upon observing unauthorised transactions."

Investigating abnormalities with wallet movements related to consolidation of ftx balances across exchanges - unclear facts as other movements not clear. Will share more info as soon as we have it. @FTX_Official
— Ryne Miller (@_Ryne_Miller) November 12, 2022

Cold storage refers to crypto wallets that are not connected to the internet to guard against hackers.

Late on Friday, Miller tweeted that he was "investigating abnormalities with wallet movements related to consolidation of FTX balances across exchanges."

Figures from Singapore-based analytics firm Nansen showed a one-day net outflow from FTX of about $266 million (nearly Rs. 2,100 crore), with $73 million (nearly Rs. 580 crore) withdrawn from FTX US alone.

FTX did not respond to a Reuters request for comment.

Prior to Miller's tweets, FTX officials appeared to confirm rumors of a hack on the firm's Telegram channel, according to a CoinDesk report which said that the exchange had instructed customers to delete FTX apps and avoid its website.

"FTX has been hacked," an account administrator in the FTX Support Telegram channel wrote in a message, according to CoinDesk.

Reuters could not immediately verify the details posted on FTX's private Telegram channel.

FTX, affiliated crypto trading firm Alameda Research and about 130 of its other companies have filed for bankruptcy court protection from creditors in Delaware, FTX said on Friday.

The distressed crypto trading platform had struggled to raise billions as traders withdrew $6 billion (nearly Rs. 48,300 crore) in crypto tokens from the platform in just 72 hours and rival exchange Binance abandoned a proposed rescue deal this week.

© Thomson Reuters 2022

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