FTX reportedly hacked as Telegram group administrator comments on possible “malware” in apps and irregular money movements recorded on the channel

Administrators of the Telegram group in the FTX community said the platform had been hacked and all funds in the exchange appeared to be gone. FTX’s U.S. general counsel, Ryne Miller, who reportedly pinned the message to the group, explained that he was investigating “anomalies“regarding FTX balances on other exchanges.

FTX officials say they were victims of a hack on Telegram

An administrator of the now-shuttered FTX community Telegram group announced that the exchange was the victim of a hacking attempt on Nov. 12. The message, which was pinned by FTX’s U.S. general counsel Ryne Miller, informed of an ongoing hack and advised customers not to use FTX apps, noting that they could also be compromised.

Official: FTX has been hacked.
Source: admin of FTX Community Chat pic.twitter.com/IukG4ekWhO

– 0xTre (@0xTre) November 12, 2022

The administrator, identified as Rey, wrote to:

FTX has been hacked. FTX applications are malware. Remove it. The chat is open. Do not go to the FTX website as it may download trojans.

Several users on social networks have reported having their wallets in the exchange having been drained of their funds, and seeing the exchanges of their tokens by stable currencies like Dai onchain. Martin Lee of Nansen observed ” massive withdrawals to the same portfolio “, which the exchange had not previously been informed of.

General counsel sees anomalies, Onchain funds blocked by Tether

Investigating abnormalities with wallet movements related to consolidation of ftx balances across exchanges – unclear facts as other movements not clear. Will share more info as soon as we have it. @FTX_Official

– Ryne Miller (@_Ryne_Miller) November 12, 2022

While FTX’s usual communication channels were silent on the matter, Ryne Miller, FTX’s U.S. general counsel, said he reviewed the transactions earlier in the evening. Miller tweeted:

We are investigating anomalies in portfolio movements related to the consolidation of ftx balances on the various exchanges – the facts are unclear as the other movements are unclear. We will share more information as soon as we have it.

The funds that were withdrawn in the form of USDT in different chains were blocked by Tether, according to according to reports. More than 30 million USDT were involved in this movement.

Following the Chapter 11 bankruptcy filings – FTX US and FTX [dot] com initiated precautionary steps to move all digital assets to cold storage. Process was expedited this evening – to mitigate damage upon observing unauthorized transactions.

– Ryne Miller (@_Ryne_Miller) November 12, 2022

Miller also said the exchange is now moving remaining funds to cold portfolios to preserve remaining capital after an investigation into these “unauthorized transactions.” He stated:

Following the Chapter 11 filings – FTX US and FTX.com have taken precautionary measures to move all digital assets to cold storage. The process was expedited tonight – to mitigate the damage caused by the observation of unauthorized transactions.

According to a Reuters article, former FTX CEO Sam Bankman-Fried allegedly put a backdoor into FTX’s system. “In a subsequent review, FTX’s legal and finance teams also learned that Mr. Bankman-Fried had set up what the two people described as a ‘back door’ in FTX’s accounting system, which was built using custom software,” Reuters reports.

The news outlet also spoke with Bankman-Fried via text message and Reuters said Bankman-Fried denied any backdoor existed. The exchange filed for Chapter 11 bankruptcy protection on November 11. The story is still developing, as fund movements continue at the time of writing.