Bahamas regulator temporarily seizes FTX unit’s assets worth more than $3.5B

The Securities Commission of the Bahamas directed the transfer of all digital assets in FTX’s Bahamas unit FTX Digital Markets that were valued at more than $3.5 billion to digital wallets controlled by the commission, it said on Thursday.

The digital assets are being held on a temporary basis, the regulator said.

Upon completion of the transfer, FTX founders Sam Bankman-Fried and Gary Wang no longer had access to the tokens that were transferred or frozen, the executive director of the commission, Christina Rolle, said in an affidavit filed with the Bahamas Supreme Court.

“All transferred assets were and remain under the sole control of the commission,” Rolle said.

Lawyers for crypto exchange FTX earlier this month opposed a demand for internal records from its Bahamian business, saying they “do not trust” the Bahamian government with data that could be used to siphon off assets from the bankrupt company.

FTX, its hedge fund Alameda Research and dozens of affiliates filed for U.S. bankruptcy last month.

The same week, authorities in the Bahamas, where the company had its headquarters, appointed liquidators to wind down FTX’s international trading business