Thursday, February 22, 2024

FTX thief cashes out millions during Bankman-Fried trial

In a shocking turn of events, a thief who stole over $470 million in cryptocurrency during the collapse of the FTX exchange is attempting to cash out their ill-gotten gains while the exchange’s founder, Sam Bankman-Fried, is on trial for fraud. Despite lying dormant for nine months, experts have identified that $20 million of the stolen funds is being laundered into traditional money every day. This new analysis reveals the desperate attempts of the mystery thief to conceal their tracks as they exploit the chaos surrounding the trial. This article delves into the details of the theft, the current state of the stolen funds, and the unusual behavior exhibited by the thief.

FTX thief cashes out millions during Bankman-Fried trial

FTX thief cashes out millions during Bankman-Fried trial

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The recent trial of Sam Bankman-Fried, the founder of FTX, has taken an unexpected turn as a thief who stole millions from the exchange is attempting to cash out the stolen funds. The trial has attracted significant media attention due to Bankman-Fried’s high-profile status in the cryptocurrency world. The stolen funds, totaling over $470 million, were taken during the bankruptcy of FTX, leaving many customer funds missing. In this article, we will delve into the details of this theft and the subsequent laundering of the stolen funds, as well as explore potential links to Russian cyber-crime.

The Theft and FTX Bankruptcy

FTX, once a prominent exchange platform for cryptocurrencies, found itself in a dire situation when it went bankrupt in November 2022. Shortly before the bankruptcy, an unidentified thief managed to steal hundreds of millions of dollars worth of cryptocurrency from FTX’s wallets. The stolen funds, totaling $477 million, were moved to a new wallet by the thief, leaving FTX and its customers devastated.

The exact details of how the thief obtained the digital keys to FTX’s wallets remain unknown, but experts believe it was either an insider or a hacker with advanced skills. This theft not only resulted in substantial financial losses for FTX and its customers but also raised concerns about the security of cryptocurrency exchanges.

FTX thief cashes out millions during Bankman-Fried trial

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Sam Bankman-Fried’s Trial Begins

As the trial of Sam Bankman-Fried commenced, the focus shifted from the missing funds to his alleged involvement in misusing customer funds and money laundering. Bankman-Fried, a former crypto mogul, has pleaded not guilty to these charges. Meanwhile, bankruptcy lawyers are desperately trying to locate the missing billions in customer funds as part of their investigation.

The trial has received significant attention, given Bankman-Fried’s prominence in the cryptocurrency sector. The outcome of this trial will have far-reaching implications for the future of cryptocurrency regulation and the accountability of crypto industry leaders.

The Stolen Stash Starts Being Laundered

Following a lengthy dormancy period of nine months, the stolen funds have started to be laundered into traditional money. Reports suggest that approximately $20 million of the stolen stash is being converted into traditional currency every day. This laundering process involves transferring the stolen cryptocurrency to a mixer, a service commonly used by criminals to obscure the origin of Bitcoin transactions.

Experts have analyzed the methods used by the thief to hide their tracks and noted that this activity goes against the typical behavior observed in cryptocurrency hackers and thieves. Instead of waiting for the public attention to dissipate, as many launderers do, this thief chose to start moving and cashing out the stolen assets just as the FTX trial gained global attention.

FTX thief cashes out millions during Bankman-Fried trial

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Attempts to Hide the Tracks

Using a mixing service to hide the origins of illicitly obtained Bitcoin is crucial for criminals to avoid detection and seizure of their funds by cryptocurrency exchanges. However, these services are not foolproof, as demonstrated by the tracing efforts of companies like Elliptic.

Elliptic, a cryptocurrency investigation firm, was able to trace $4 million of stolen funds to an exchange, despite attempts to hide the money’s origin. This highlights the challenges faced by criminals in laundering stolen cryptocurrencies and reinforces the importance of robust tracing mechanisms in the cryptocurrency ecosystem.

Unusual Activity for Crypto Hackers

The activity of this particular thief diverges from the norms observed in cases of cryptocurrency hacking and laundering. Typically, launderers wait for considerable periods, sometimes years, before moving and cashing out their assets to avoid detection. However, in this instance, the thief began their laundering activities just as the world’s attention turned to the FTX trial and the events surrounding the theft.

This unusual behavior raises questions about the motivations and intentions of the thief. It suggests a level of boldness and disregard for conventional money-laundering strategies commonly observed in the cryptocurrency world.

FTX thief cashes out millions during Bankman-Fried trial

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Potential Link to Russian Cyber-Crime

Further investigations into the stolen Bitcoin have revealed a potential link to Russian cyber-criminal groups. Elliptic, the cryptocurrency investigation firm, traced some of the laundered funds to a wallet known to be used by Russian-linked criminal organizations. This finding points to the possibility of a broker or intermediary with connections to Russia being involved in the laundering process.

The potential involvement of Russian cyber-criminals in this case adds another layer of complexity to the already intricate web surrounding the FTX theft. It highlights the global nature of cyber-crime and the need for international cooperation to combat these criminal activities effectively.

BBC Panorama Documentary

The FTX theft and the subsequent trial of Sam Bankman-Fried have captured the attention of media worldwide. BBC Panorama, a renowned investigative journalism program, has produced a documentary delving into the rise and fall of Sam Bankman-Fried. The documentary provides an in-depth exploration of the events leading to the FTX bankruptcy, the theft, and the ongoing trial.

The documentary offers viewers an opportunity to gain a comprehensive understanding of the intricate details of this case. It aims to shed light on the broader implications of the FTX theft and its impact on the cryptocurrency industry as a whole. The premiere date and viewing information for the BBC Panorama documentary will be announced soon.

FTX thief cashes out millions during Bankman-Fried trial

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The ongoing trial of Sam Bankman-Fried and the laundering of the stolen FTX funds by an unknown thief have exposed the vulnerabilities and risks associated with the cryptocurrency industry. The theft itself was a significant blow to FTX and its customers, leaving billions of dollars in customer funds missing. The subsequent trial has brought the spotlight onto the alleged misuse of customer funds and money laundering.

The unusual behavior of the thief, starting to cash out the stolen assets during the trial, has raised eyebrows in the cryptocurrency community. It has prompted speculation about the thief’s motivations and potential links to Russian cyber-criminals. The investigation and tracing efforts by companies like Elliptic have shed light on the challenges involved in laundering stolen cryptocurrencies.

The BBC Panorama documentary will provide a comprehensive overview of the FTX theft and trial, offering viewers an opportunity to delve into the intricate details of this case. As the trial continues and more information emerges, the implications for the cryptocurrency industry will become clearer. It is crucial for regulators, exchanges, and industry leaders to learn from this incident and work towards strengthening the security and accountability of the cryptocurrency ecosystem.