The recent financial collapse of FTX was the biggest scandal in cryptocurrency this year and perhaps all of the world’s fintechs. It started when one of the world’s largest crypto exchange platforms, considered an industry heavyweight and backed by top venture capitalists since earlier this month, filed for bankruptcy, citing a “liquidation crisis.”
The company also suspended all trading on its platform, causing thousands of customers and millions of dollars to plummet. FTX founder Sam Bankman-Fried is facing allegations of embezzlement of funds and a failed acquisition by Binance (see below). Illegal trading on FTX leads to cash shortages).
Adding to this unfortunate string of events, hours after the company filed for bankruptcy protection in the United States, the company’s new CEO, John Ray, said: attacker says Having gained unauthorized access to “certain assets,” the company said it had “moved as many digital assets as it could identify to the new cold wallet custodians.”
In the first of a two-part interview with the Information Security Media Group, Hugh Brooks, director of security operations at web3 security company CertiK, explains:
- How Hundreds of Millions of Dollars of Cryptocurrency Leaked from Bankrupt Trading Platforms.
- where the funds are currently located;
- Why it’s hard to off-ramp stolen funds and how law enforcement can intervene.
Brooks also discussed how this incident will affect the overall security of the web3 industry, what it means for the cybersecurity of FTX-exposed exchanges, and whether new regulations could be the case in the future. We will also share the role and best practices of decentralization for cybersecurity. Crypto exchange practices.
Brooks, who leads security operations at CertiK, is a product director, senior manager, and consultant for technology development and deployment in cryptocurrencies, data, social media, and cybersecurity.