Peter Smith, the creator, and CEO of Blockchain.com discussed how blockchain can and cannot be used to track the FTX money in an interview with Liz Claman of FoxBusiness, on December 20th.
When Liz Claman asked Peter Smith what it could track in the case of FTX’s missing client payments, he said that blockchain’s selling point was that it made crypto transactions visible and traceable.
However, despite its limitations, Peter Smith thinks on-chain analytics will be very beneficial in identifying the lost FTX funds. He also asserts that on-chain analytics would be immensely useful to liquidators for cryptos still in the system because these records cannot be changed or altered.
According to the statement:
On-chain analytics will be tremendously helpful to joint liquidators as they try to untangle this mess since those are records that can’t be changed or altered.
Additionally, he argues that the most significant obstacle facing blockchain analytics companies now working on this is the inability to track money as it enters the banking system.
As this would have come through a bank, he used the scenario of Sam Bankman-Fried or his partners buying real estate. Once they left the crypto ecosystem, he claimed, it would be difficult to link those assets back to FTX or a blockchain.
Furthermore, he claims that Events on the Blockchain where FTX and its customers lost money, including in trading bets, liquidity farming, or withdrawals for like venture investments, can be traceable. He adds you can also use Events to see how much crypto people deposited in FTX.
He also mentions the Nansen ai for this purpose:
One particular company that’s really worth following is Nansen_ai. They do phenomenal blockchain analytics work that’s worth taking a look at while evaluating this whole situation.
FTX Has Over $1 Billion In Cash
The new management of FTX stated that it had discovered assets worth more than $1 billion on December 20th at a procedural hearing. The new management was appointed when Sam Bankman-Fried, the creator of FTX, resigned from his position.
The company was reported to have around $720 million in cash assets at banks authorized by the US Department of Justice, and around another $500 million is also being held by U.S.-based banks.
While testifying under oath during a section of the bankruptcy proceedings, Mary Cilia, FTX’s new chief financial officer, said:
We are reaching out to all of those banks and changing the signatories on the accounts so that we can get access to the accounts and move the cash as much as we can to authorized depository institutions.
Cilia stated that around $130 million in cash was stuck in Japan, which cannot be transferred because of the country’s laws. Cilia also reported that $6 million had been kept for operations expenses like payroll.
Additionally, most of the rest ($423 million) are at unauthorized American institutions, but no more than one broker(Cilia didn’t specify which ones), and over half a billion dollars ($485 million) have already been moved into an authorized bank account.
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