Just a few days after the former CEO Sam Bankman Fried was released on a $250 million bond, it was discovered that the cryptocurrency wallets linked to the now-defunct trading firm Alameda Research—sister company to FTX—was sending money out.

Crypto community discuss suspicious Alameda wallet transactions

More than only raising questions about the transfer of money from Alameda wallets, the community was intrigued by how these cash were moved. It was discovered that the Alameda wallet was exchanging ERC-20 token bits for Ether (ETH) and Tether (USDT) before passing the ETH and USDT through mixers and instant exchanges.

As an illustration, a wallet address with the prefix 0x64e9 received more than 600 ETH from wallets belonging to Alameda; a portion of this was converted to USDT, and the remaining portion was delivered to ChangeNow.

The Alameda wallet finally exchanged the funds for Bitcoin BTC by leveraging decentralized exchanges like FixedFloat and ChangeNow, according to on-chain expert ZachXBT. Hackers and other exploiters frequently utilize these platforms to conceal the paths taken by their transactions. A Twitter account with handle @ErgoBTC tweeted:

Never-ending FTX and Alameda saga

Every day brings a new twist to the never-ending FTX issue, and the community is concerned about the most recent transfer of money to extract whatever is still in those cryptocurrency wallets.

Many people hypothesized that the way these funds are being transferred appears to be exploitative, but considering that Bankman-Fried is now known to have a criminal record, many people also thought it might be an inside job to remove whatever money is still in those wallets.

https://twitter.com/ZcryptA/status/1607975172891627522?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1607975172891627522%7Ctwgr%5E9eb9abaf9ca3d4e278bd52f7cd9af10126a71c48%7Ctwcon%5Es1_c10&ref_url=https%3A%2F%2Fd-24352018143353239330.ampproject.net%2F2211302304002%2Fframe.html

Others inquired why he was permitted access to the internet and questioned the bail requirements. One commenter asked why the former CEO’s bail conditions didn’t include being prohibited from using a computer or the internet while desperately trying to move money out.

The continuous fund movements from Alameda wallets coincided with Bankman Fried’s release on bail because immediately FTX filed for bankruptcy on November 11, the exchange wallets was being compromised for millions of dollars. Now the US Department of Justice is looking into the $372 million FTX exploit, following FTX’s filing for bankruptcy,

Customers of FTX initiate a class action lawsuit to obtain priority damages

While a number of governmental organizations are lining up to sue the FTX and its creator Sam Bankman-Fried, a group of former clients are making an attempt to get their funds refunded first. In a class action lawsuit filed by four people, the company’s customers, not investors, demand that they be given priority access to its frozen cash. 

In the District of Delaware’s US Bankruptcy Court, the lawsuit was submitted on December 27. In a class action lawsuit, which could include up to 1 million people, four plaintiffs assert that they speak for the whole group of former FTX customers. 

The priority rights to give customers of FTX US or FTX.com access to digital assets that these companies have in their possession are what the action seeks to secure. The plaintiffs stress that the FTX User Agreement did not authorize the platform to borrow money from customers or use consumer funds for running costs. The complaint states that any withdrawal of money from client accounts constitutes “unlawful co-mingling, embezzlement, misuse, or transfer of customer property.” 

Therefore, until consumers are paid back, any money frozen by FTX and identifiable as client assets cannot be utilized to settle non-customer expenses, claims, or creditors. Now the community is suspecting foul play following the transfer of funds from Alameda wallets.