A new document issued by the Securities Commission of the Bahamas reveals that FTX Digital Markets has transferred all of its assets to the financial policeman and therefore to the Bahamian government. At the same time, the latter does not recognize the bankruptcy of FTX under the protection of American jurisdiction, and a showdown could now begin between the 2 countries.
New twist in the FTX case
The ramifications of the FTX file continue to multiply in a sad way, since we learn today that the Securities Commission of the Bahamas, the organization in charge of financial regulation in the Bahamas, ordered FTX Digital Markets (the Bahamian branch of the exchange) to transfer all of its assets to the local government.
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Securities Commission of The Bahamas Assumes Control of Assets of FTX Digital Markets Ltd. pic.twitter.com/IzW4PGZSJm
— Securities Commission of The Bahamas (@SCBgov_bs) November 18, 2022
“The Securities Commission of the Bahamas, in exercise of its regulatory powers acting under the authority of an order made by the Supreme Court of the Bahamas, has taken the step of ordering the transfer of all digital assets of FTX Digital Markets Ltd. to a Commission-controlled digital wallet for safekeeping. Urgent interim regulatory action was necessary to protect the interests of FDM’s customers and creditors. »
Thus, many questions arise : Why did the financial policeman of the Bahamas wait so long to publish this press release, and when were the transfers in question made? Moreover, the document does not reveal details such as the amounts transferred by FTX Digital Markets.
The financial regulator says the measure, taken under cover of the Digital Assets and Registered Exchanges Act of 2020, aims to “protect the interests of customers”.
The temporality of the events also contributes to sowing doubt insofar as we learned on November 13, either the day after this transfer orderthat Bahamian police had placed FTX under police investigation.
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Opposition between Bahamas and United States
One line from the document issued by the Securities Commission of the Bahamas, although short, is of major importance: the financial watchdog does not recognize the nature of the bankruptcy via Chapter 11 from FTX Digital Markets.
This procedure specific to the American jurisdictionwidely used by companies reporting substantial liquidity crises, allows them to operate their activities under strict control by the competent regulators.
Thus, according to the Securities Commission of the Bahamas, the case of FTX Digital Markets will not be settled – or at least not exclusively – on US soil.
Beyond these troubling elements that will need to be clarified by a clear legal review, it is all the more troubling that FTX Digital Markets has filed for bankruptcy in the Southern District of New York and not in the Delaware, where all other FTX branches have filed their respective applications.
In short, the more the FTX file progresses, the more it appears to be filled with contradictions and disturbing internal elementswhich unfortunately can only leave us spectators of an unnamed disaster whose collateral damage will not leave the cryptocurrency ecosystem unscathed.
👉 Read also – Collateral damage from FTX: Coinhouse suspends withdrawals from its crypto passbook
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Source: Official document
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Passionate about the world of decentralized finance and the novelties brought by Web 3.0, I write articles for Cryptoast to help make blockchain more accessible to everyone. Convinced that cryptocurrencies will change the future very soon.
Maximilien Prue
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