FTX funds on the move as thief converts thousands of ETH into Bitcoin

According to blockchain analysis company Chainalysis, funds stolen from the FTX crypto exchange are now being converted from ETH into Bitcoin. On Nov. 20, Chainalysis took to Twitter to encourage exchanges to freeze these coins, should the thief attempt to convert them into fiat or further obfuscate the assets through other means.

1/ Funds stolen from FTX are on the move and exchanges should be on high alert to freeze them if the hacker attempts to cash out

— Chainalysis (@chainalysis) November 20, 2022

Amid the controversial collapse and bankruptcy of FTX, news broke that an unknown actor had stolen 228,523 ETH from the exchange. The ownership of these coins, worth a whopping $268,057,479 USD at time of publication, currently rank the thief as one of the largest owners of ETH in the world.

Update: FTX Hacker is now actively dumping ETH on-chainHe has dumped about $15 million ETH in the past 30 minutes and just prepped a fresh batch of $12 millionStill has $270m ETH in main walletHe's selling ETH to wBTC to renBTC through aggregators like 1inch https://t.co/mEd8UHFCO0

— kamikaz ΞTH (@kamikaz_ETH) November 20, 2022

Though initial reports suggested that all of the funds in question might be in the custody of securities regulators in the Bahamas, Chainalysis poured cold water on this theory however, stating:

“Reports that the funds stolen from FTX were actually sent to the Securities Commission of The Bahamas are incorrect. Some funds were stolen, and other funds were sent to the regulators.”

At time of publication, approximately 31,000 ETH had been converted into wrapped BTC. The thief then sent the coins crosschain to a Bitcoin mainnet wallet using the Ren Protocol, with the final amount received totalling 2444.55 BTC.

LIVE: FTX Drainer (Aka Bahamas Gov?) Liquidating ETHAddy #1 - 0x59Addy #2 - 0x86Flow So Far- Move $ETH from #1 to #2 - Swap $ETH for $renBTC- Send it to NULL AddyUpdate- Sold 31k $ETH for 2.2k $renBTC- Sending all $renBTC to NULL Address (ETH Genesis Address)1/n pic.twitter.com/WfkXGsUDRq

— Garlam (@GarlamWON) November 20, 2022

It’s been a tough few weeks for those affected by the collapse of FTX and its associated companies. Earlier today, a press release indicated that FTX debtors are in talks with finserv firm Perella Weinberg Partners with regard to various reorganization attempts. The engagement is subject to the bankruptcy court’s approval, however.

Meanwhile, the company’s founder Sam Bankman-Fried allegedly remains "under supervision" in the Bahamas, though some fear he may attempt to flee to Dubai if given the opportunity. It is unclear how this situation would play out ultimately, given that the UAE and the USA have an agreement on evidence sharing, judicial cooperation and assistance in criminal investigations and prosecutions.