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FTX Disputes Bahamas Regulator's Claim of Holding $3.5 Billion in Assets

Cryptocurrency exchange FTX has disputed claims by the Securities Commission of the Bahamas (SCB) that the regulator holds $3.5 billion of the company's assets. In a statement on Friday, FTX said that when the SCB seized the digital assets in November, they were worth just $296 million.

FTX Logo
FTX logo

The exchange urged the SCB to "clear up any confusion" about its assets and their value.

FTX Seeks Return of Seized Assets

FTX has said that it will seek the return of any assets seized by the Securities Commission of the Bahamas (SCB), as FTX Digital Markets Ltd., the company's Bahamas-based unit, is only a "local service company" which does not own the FTX exchange or any of the cryptocurrency seized. The SCB began liquidation proceedings against FTX DM in November.

SCB Seizes Over $3.5 Billion in Cryptocurrency

SCB announced on Thursday that it had seized over $3.5 billion in cryptocurrency and was holding those funds for future repayment to FTX's customers and other creditors. The SCB did not identify the type of cryptocurrency seized or say how it was valued.

Most Seized Cryptocurrency in the form of FTX's FTT Tokens

FTX stated Friday that most of the seized cryptocurrency was in the exchange's proprietary FTT tokens. As of December 20, the seized FTT tokens would have plummeted in value to $167 million, and the SCB may struggle to find a buyer for such a significant stake even at that lowered price, according to FTX.

Tensions Between FTX and Bahamian Officials

FTX has been at odds with Bahamian officials since filing for bankruptcy protection on November 11. Bahamian officials have requested access to FTX's records to assist in liquidating FTX DM. Still, FTX's US bankruptcy team has said that they do not trust Bahamian officials with that information.

FTX's founder and former CEO, Bankman, has been arrested on fraud charges and is set to be arraigned on January 3, 2023, before US District Judge Lewis Kaplan in Manhattan federal court. FTX's new CEO, John Ray, has said that the exchange lost $8 billion in customer money.