Kraken has frozen the accounts associated with FTX Group, Alameda Research, and their executives
After speaking with authorities, the cryptocurrency exchange Kraken, based in the United States, froze the accounts connected to “FTX Group, Alameda Research, and their executives” on its platform.
On November 13, Kraken wrote on Twitter that the accounts were frozen “to protect their creditors” that it “maintains full reserves” and that other users’ funds are unaffected. Kraken was probably attempting to alleviate user concerns that the exchange might experience liquidity problems due to the fund freeze.
Crypto exchange Kraken freezes accounts related to FTX and Alameda
Kraken has spoken with law enforcement regarding a handful of accounts owned by the bankrupt FTX Group, Alameda Research and their executives. Those accounts have been frozen to protect their creditors.
Other Kraken clients are not affected. Kraken maintains full reserves.
— Kraken Exchange (@krakenfx) November 13, 2022
A Kraken spokesperson said that it had “actively monitored recent developments with the FTX estate” and “are in contact with law enforcement,” saying it froze account access to certain funds “we suspect to be associated with ‘fraud, negligence or misconduct’ related to FTX. We will resolve each account on a case-by-case basis and may seek guidance from the Bankruptcy Court or trustee as appropriate,” the spokesperson added.
Kraken’s account suspension follows the cryptocurrency exchange FTX’s Nov. 11 announcement that the FTX Group, which consists of about 130 businesses, including its sister trading company Alameda Research, filed for Chapter 11 bankruptcy in the United States and that Bankman-Fried has resigned as CEO.
It is also related to a rumored hack on FTX that allegedly involved a Kraken account. On November 12, Kraken’s chief security officer Nick Percoco stated that they were aware of the identity of the account owner and later updated that FTX would state the situation “and them utilizing funds from their verified account to complete this transaction.”
In light of the recent unrest, regulators seem to be cracking down hard on FTX and its management. The Bahamas’ securities regulator on November 10 seized the assets of FTX Digital Markets, the exchanges’ Bahamian affiliate, and its “associated parties.” FTX is headquartered in The Bahamas.
After the exchange claimed on Nov. 11 that it had been told by the nation’s regulators to facilitate Bahamian withdrawals, the Bahamian securities authority on Nov. 12 denied giving FTX instructions to give Bahamas-based users’ withdrawals priority.
While FTX is currently being looked at by the Royal Bahamas Police Force for potential criminal activity, per a story from November 13.
Read more:
- Celsius Network Confirmed Exposures To FTX Exchange And Trading Firm Alameda Research
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