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FTX says it is investigating ‘unauthorized transactions’

In this photo illustration, the FTX website is seen on a computer on November 10, 2022 in Atlanta, Georgia. Binance, the world’s largest cryptocurrency firm, agreed to acquire FTX, another large cryptocurrency exchange, in a rushed sale in order to prevent a liquidity crisis, which is known as the “Lehman Moment” in the crypto industry.

Michael M. Santiago | Getty Images

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following a series of “unauthorized transactions”, with analysts saying millions of dollars worth of assets had been withdrawn from the platform.

FTX U.S. 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 unauthorized transactions.”

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Singapore-based analytics firm Nansen showed a one-day net outflow from FTX of about $266 million, with $73 million withdrawn from FTX U.S. alone.

FTX did not respond to a Reuters request for comment.

Sam Bankman-Fried, co-founder and chief executive officer of FTX, in Hong Kong, China, on Tuesday, May 11, 2021.

Lam Yik | Bloomberg | Getty Images

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 in crypto tokens from the platform in just 72 hours and rival exchange Binance abandoned a proposed rescue deal this week.

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