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US crypto exchange Kraken freezes accounts owned by FTX and Alameda after talking to law enforcement<!-- wp:html --><p>Kraken has frozen all accounts associated with FTX, Alameda and its execs.</p> <p class="copyright">Silas Stein/picture alliance via Getty Images)</p> <p>Crypto exchange Kraken has frozen accounts owned by FTX and Alameda Research to protect creditors. <br /> Kraken said it took the move after speaking to law enforcement about the handful of accounts.<br /> Bahamas police are investigating FTX, which has filed for bankruptcy, over potential criminal misconduct.</p> <p>Crypto exchange Kraken has frozen accounts on its platform linked to collapsed rival FTX and its sister trading firm Alameda Research, after discussions with law enforcement authorities.</p> <p>"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," the San Francisco-based exchange <a href="https://twitter.com/krakenfx/status/1591678095840641025">tweeted Sunday</a>.</p> <p>"Other Kraken clients are not affected. Kraken maintains full reserves," it added. </p> <p>The move comes after more than $600 million was drained from wallets on FTX's platform late Friday, <a href="https://www.coindesk.com/business/2022/11/12/ftx-crypto-wallets-see-mysterious-late-night-outflows-totalling-more-than-380m/">CoinDesk reported</a>. The apparent hack followed soon after the company's <a href="https://markets.businessinsider.com/news/currencies/ftx-bankruptcy-sam-bankman-fried-ceo-crypto-binance-alameda-markets-2022-11">filing for Chapter 11 bankruptcy</a>, it said.</p> <p>Separately, at least $1 billion in FTX customer funds has <a href="https://markets.businessinsider.com/news/currencies/ftx-crypto-billions-customer-funds-missing-collapse-bankruptcy-bankman-fried-2022-11">vanished</a> after its former CEO Sam Bankman-Fried quietly transferred $10 billion to Alameda, Reuters reported. It cited two people it described as formerly holding senior positions at the exchange.</p> <p>Bankman-Fried rejected the characterization of the transfer in the report in a response to Reuters. FTX did not respond to Insider's request for comment. </p> <p>On Sunday, <a href="https://markets.businessinsider.com/news/currencies/bahamas-police-investigate-ftx-criminal-misconduct-crypto-sbf-bankruptcy-liqudity-2022-11">police in the Bahamas said they are investigating</a> FTX for potential criminal misconduct. The nation's securities regulator froze the assets of a subsidiary of the crypto exchange on Thursday, saying it was aware of statements suggesting FTX mishandled, mismanaged, or transferred the assets of clients to Alameda.</p> <p>A Kraken spokesperson told Insider: </p> <p>"We have actively monitored recent developments with the FTX estate, are in contact with law enforcement, and have frozen Kraken account access to certain funds we suspect to be associated with 'fraud, negligence or misconduct' related to FTX." </p> <p>"We will resolve each account on a case-by-case basis and may seek guidance from the Bankruptcy Court or trustee as appropriate."</p> <p>FTX's downfall, sparked by a significant liquidity crunch, has rocked the world of crypto and triggered a crisis of confidence in the digital-asset market. Rumors about FTX's insolvency prompted a rush among its customers to withdraw funds, which saw about <a href="https://markets.businessinsider.com/news/currencies/ftx-6-billion-withdrawals-72-hours-sam-bankman-fried-binance-2022-11?utm_medium=ingest&utm_source=markets">$6 billion pulled out of the crypto exchange in just 72 hours</a>. </p> <p><em>This story was updated on November 14 with comment from Kraken.</em></p> <div class="read-original">Read the original article on <a href="https://www.businessinsider.com/ftx-crypto-exchange-kraken-freezes-accounts-alameda-2022-11">Business Insider</a></div><!-- /wp:html -->

Kraken has frozen all accounts associated with FTX, Alameda and its execs.

Crypto exchange Kraken has frozen accounts owned by FTX and Alameda Research to protect creditors. 
Kraken said it took the move after speaking to law enforcement about the handful of accounts.
Bahamas police are investigating FTX, which has filed for bankruptcy, over potential criminal misconduct.

Crypto exchange Kraken has frozen accounts on its platform linked to collapsed rival FTX and its sister trading firm Alameda Research, after discussions with law enforcement authorities.

“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,” the San Francisco-based exchange tweeted Sunday.

“Other Kraken clients are not affected. Kraken maintains full reserves,” it added. 

The move comes after more than $600 million was drained from wallets on FTX’s platform late Friday, CoinDesk reported. The apparent hack followed soon after the company’s filing for Chapter 11 bankruptcy, it said.

Separately, at least $1 billion in FTX customer funds has vanished after its former CEO Sam Bankman-Fried quietly transferred $10 billion to Alameda, Reuters reported. It cited two people it described as formerly holding senior positions at the exchange.

Bankman-Fried rejected the characterization of the transfer in the report in a response to Reuters. FTX did not respond to Insider’s request for comment. 

On Sunday, police in the Bahamas said they are investigating FTX for potential criminal misconduct. The nation’s securities regulator froze the assets of a subsidiary of the crypto exchange on Thursday, saying it was aware of statements suggesting FTX mishandled, mismanaged, or transferred the assets of clients to Alameda.

A Kraken spokesperson told Insider: 

“We have actively monitored recent developments with the FTX estate, are in contact with law enforcement, and have frozen Kraken 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.”

FTX’s downfall, sparked by a significant liquidity crunch, has rocked the world of crypto and triggered a crisis of confidence in the digital-asset market. Rumors about FTX’s insolvency prompted a rush among its customers to withdraw funds, which saw about $6 billion pulled out of the crypto exchange in just 72 hours

This story was updated on November 14 with comment from Kraken.

Read the original article on Business Insider

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