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The Bahamas Securities Commission has ordered crypto exchange FTX to transfer its cryptocurrencies to a wallet controlled by the regulator. The “urgent interim regulatory action was necessary to protect the interests” of FTX’s customers and creditors, the regulator said.

Bahamian Regulator Takes Steps To Seize FTX Cryptocurrencies To ‘Protect’ Them

The Bahamas Securities Commission (SCB) announced on Thursday that it had taken “the step of directing the transfer of all digital assets of FTX Digital Markets Ltd. (FDM) to a digital wallet controlled by the Commission, for the guard”. FTX Digital Markets is the Bahamian subsidiary of FTX Trading Ltd. of Sam Bankman-Fried, who owns and operates the crypto-trading platform.

The securities regulator noted that the agency “acts under the authority of an order made by the Supreme Court of the Bahamas”, stating:

Urgent interim regulatory measures were needed to protect the interests of FDM’s customers and creditors.

The regulator clarified: “Under the Digital Assets and Registered Exchanges Act 2020 (DARE Act), the Commission has the power to seek a court order to protect the interests of customers or customers of a registrant of the Commission under the DARE Act. .”

The ad continues:

Over the coming days and weeks, the Commission will engage with other regulators and authorities, in multiple jurisdictions, to address issues affecting FDM’s creditors, customers and stakeholders globally in order to get the best possible result.

The Bahamas Securities Commission has taken steps to freeze the assets of FTX Digital Markets and related parties on November 10 as the crypto exchange’s troubles unfolded.

The regulator has also asked the Supreme Court to appoint Brian Simms as a court-supervised interim liquidator. Additionally, Kevin Cambridge and Peter Greaves of pricewaterhousecoopers (PwC) were approved by the court as provisional joint liquidators.

What are your thoughts on the Bahamas Securities Commission ordering FTX to transfer digital assets to a wallet it controls for “custodial” purposes? Let us know in the comments section below.

Kevin Helms

An economics student from Austria, Kevin discovered Bitcoin in 2011 and has been an evangelist ever since. His interests include Bitcoin security, open source systems, network effects, and the intersection between economics and cryptography.

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