Bahamas vs USA: FTX Gears up for a Fight as Bahamas Govt Takes Control of Its Assets

While customers are looking for billions of dollars lost in FTX’s collapse, FTX Bahamas where the exchange was headquartered, and FTX US are preparing to battle after bankruptcy documents were filed.

The Securities Commission Bahamas released a press statement on Thursday signaling a fight with FTX-US. “It is not the understanding of the Commission that FDM (FTX Digital Market) is a party to the US Chapter 11 Bankruptcy proceedings,” the statement said.

FTX US filed for bankruptcy in Delaware while FTX Bahamas filed in a New York court. Now Bahamian liquidators are demanding the US court give them control of the proceedings since the exchange is headquartered in the Bahamas.

But FTX-US believes all bankruptcy proceedings should be in Delaware to “end the chaos” so that all proceedings could “take place in a single venue.”

Late Thursday night, the Securities Commission of the Bahamas added in a statement that it ordered the transaction of FTX’s crypto wallets to government-controlled wallets last week Saturday.

It is not known why it is just making the public aware of its authorization but only stated that existing authorities allowed the commission to take action if it needs to protect clients or their funds.

Last week, nearly 600 million dollars were purportedly “hacked” from FTX. It is alleged the Bahamas government, sanctioned by Bankman-Fried removed the money as new CEO John Ray accused the Bahamas government of ordering unauthorized access to FTX’s systems in order to withdraw assets after the Chapter 11 bankruptcy was filed in the U.S.

But the Securities Commission is stating today that an order signed by Justice Loren Klein on November 12, gave them permission to transfer assets worth millions of dollars into the government digital wallet because it feared they would be stolen by hackers.