A new report filed by debtors for defunct cryptocurrency exchange and hedge fund FTX Trading Ltd. highlighted numerous security failures at the company. FTX quickly rose to prominence after its founding in 2019, gaining billions of dollars in cryptocurrency assets in the process. Despite this, the company filed for bankruptcy in November following a potential acquisition from Binance that fell apart a day after it was announced. Soon after, the exchange was accused of defrauding its customers and mishandling investor funds. FTX co-founder Sam Bankman-Fried was arrested and charged with fraud in December. Debtors for FTX on Sunday filed a first interim report in bankruptcy court detailing various “control failures” involving the management of FTX’s exchanges. A portion of the report dealt with cybersecurity failures, including those related to cryptocurrency storage, personnel, endpoint security and more. It also covered the November 2022 data breach that apparently occurred one day after the company declared bankruptcy. An unknown threat actor used the breach to steal approximately $432 million through a series of unauthorized transactions, though it’s still unclear how the breach occurred and who executed the transactions. FTX’s debtors claim the $432 million loss was a direct result of FTX’s “grossly deprioritized and ignored cybersecurity controls.”
Full story : FTX bankruptcy filing highlights security failures.
