Crypto-currency exchange Kraken freezes accounts of FTX, Alameda Research and their executives

Crypto-currency exchange Kraken has frozen a handful of accounts belonging to bankrupt FTX, Alameda Research and their executives. Kraken was in contact with law enforcement after discovering that an account on its platform had been used in unauthorized transfers at FTX.

Kraken is freezing accounts belonging to FTX, Alameda Research and their executives.

Crypto-currency exchange Kraken has taken steps to freeze verified accounts on its platform belonging to FTX Group, Alameda Research and their executives. Kraken’s official Twitter account tweeted early Sunday morning:

Kraken has been talking to law enforcement about a handful of accounts owned by FTX Group, Alameda Research and their executives, all of which are in bankruptcy. Those accounts were frozen to protect their creditors.

Kraken pointed out, “Kraken’s other customers are not affected. Kraken maintains full reserves.“

FTX filed for Chapter 11 bankruptcy protection on Friday. John Ray was named the new chief executive of FTX Group after Sam Bankman-Fried left.

Alleged FTX hacker uses Kraken

After FTX filed for bankruptcy, Twitter users noticed that the exchange’s portfolios were emptied. Ray, the new CEO and head of FTX’s restructuring, later confirmed the unauthorized transfers.

Twitter users also noticed that funds had been transferred from Kraken to a wallet used to hold some of the stolen tokens. Hours later, Nick Percoco, Kraken’s head of security, tweeted, “We know the identity of this account“. However, he noted that he could not reveal the user’s identity publicly on social media.

Ryne Miller, general counsel for FTX, explained Saturday, “After the bankruptcy filing – FTX US and FTX.com took precautionary measures to move all digital assets to cold storage. The process was accelerated tonight – to mitigate damage when unauthorized transactions are observed.“

Ryne Miller then quoted FTX’s new CEO as saying:

As has been widely reported, unauthorized access to certain assets has occurred … We have been in contact with, and are coordinating with, appropriate law enforcement and regulators.