Bahamian Authorities Respond to New FTX CEO Claims 

Bahamian Authorities Respond to New FTX CEO Claims

As the FTX saga continues to unfold, the eyes of the world are on both its former CEO Sam Bankman-Fried and the country of the Bahamas. The former is receiving attention because of his actions as CEO and his bizarre behaviour since then. The latter is at the centre of this debacle because it was where many of FTX’s operations ran from and also because its regulators are currently in possession of $3.5 billion worth of FTX’s funds which were seized. 

Now, barely a week since the funds were confirmed to be in the Bahamian government’s possession, regulators are having to respond to the new FTX CEO.

The Great Money Debacle 

In the last few weeks, the Securities Commission of The Bahamas has had to deal with requests and statements from John Ray III, the new FTX CEO, as well as the chapter 11 debtors of the exchange. 

As per a recent statement, the chapter 11 debtors, represented by Ray, publicly challenged the calculations of the commissions regarding the funds held in its custody. But these assertions, the commission says, were made based on incomplete information. 

“The Chapter 11 Debtors chose not to utilize their ability to request information from the Joint Provisional Liquidators pursuant to a court order of the Supreme Court of The Bahamas that the Commission obtained in an effort to allow the Chapter 11 Debtors to obtain this information,” the statement said, adding that this indicated a lack of diligence and reflected a cavalier attitude towards the truth.

The commission also addressed the claim made by Ray that it has asked FTX to mint $300 million worth of new FTT tokens. This claim was made in a court filing on December 12, 2022, and then on December 13, 2022, before the United States’ House Financial Services Committee. There was also the claim that the funds that were in the commission’s possession had been stolen, which the statement not only denied but cited another statement made by Ryne Miller, the General Counsel of FTX US, that alluded to the funds being safe.

“Mr. Miller correctly recognized what the Commission recognized at the time: that it was vital that assets be custodied somewhere safe to secure those assets, and allow any disputed claims to those assets to be resolved at a later date,” the commission said, concluding with the hope that all parties would allow the proceedings continue in good faith. 

The FTX Saga in 2023

The collapse of FTX was perhaps the biggest story in the crypto industry in 2022 and from all indications, it will continue to dominate headlines in 2023 as well. And unfortunately, there already seems to be some friction between Bahamian authorities and the current FTX management. 

If, as the statement says, all parties can operate in good faith, the funds may be returned to their rightful owners. If not, we could be looking at the start of a dispute that will only prolong the FTX saga. 

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