• The US Department of Justice has reportedly launched a criminal probe into the alleged hack of FTX-controlled wallets.
• Over an hour after the suspected hack began, FTX General Counsel Ryne Miller tweeted that his company was „investigating abnormalities with wallet movements“.
• Blockchain experts have pointed to several clues that the hacker was an FTX insider.
The US Department of Justice has reportedly launched a criminal investigation into the alleged hack that drained nearly $400 million out of FTX-controlled wallets. The incident took place the night that the Bahamas-based exchange filed for bankruptcy.
Between the hours of 11 PM on Nov. 11 and the early hours of Nov. 12, massive outflows of cryptocurrencies began moving out of FTX and FTX US’s wallets. Many FTX employees took to Twitter to report that they did not recognize the transfers.
FTX General Counsel Ryne Miller was one of the first to break the news, tweeting that the company was „investigating abnormalities with wallet movements“. He also posted a message in FTX’s official Telegram support channel, warning people not to go on the FTX site as it might contain malicious Trojans.
The official FTX Twitter account remained silent throughout the pandemonium. In the afternoon of Nov. 12, FTX CEO John Jay Ray III released a statement confirming the hack and said they were in contact with law enforcement.
The criminal investigation is separate from the fraud case against former CEO Sam Bankman-Fried. Authorities have reportedly been able to freeze a portion of the stolen funds.
Blockchain experts have pointed to several clues that the hacker was an FTX insider, including the simultaneous hacks of the FTX and FTX US websites, the suspect’s access to multiple cold wallets and the use of a personal Kraken account to withdraw gas fees for at least one transaction.
These clues suggest that the hacker was very familiar with the inner workings of the FTX exchange and had access to sensitive information that enabled them to carry out the massive theft.
The US Department of Justice’s investigation is ongoing and it remains to be seen how the events of that night will pan out. FTX has since implemented more stringent security protocols to ensure the safety of their customers‘ funds, and the public is watching closely to see what the future holds for the exchange.