It has been reported that the Bahamas government collaborated with Sam Bankman-Fried, the former CEO of FTX, to launch a new cryptocurrency that local authorities will manage.
As a result of the failure of FTX in November, officials from the Bahamas government are said to have requested that Bankman-Fried “mint new digital assets worth "hundreds of millions of dollars," according to statements made by lawyers for FTX in a court filing, as reported (1) by Bloomberg on December 12.
According to reports, the authorities also requested the former CEO of FTX to hand over the management of the newly issued tokens to the island officials.
The investigation also claims that officials from the Bahamas attempted to assist Bankman-Fried in regaining access to critical computer systems of the FTX trading platform, which has since been discontinued.
Lawyers from the United States claim that officials from the Bahamas were "responsible for directing unauthorized access" to the FTX networks to seize control of digital assets and place them under the jurisdiction of a court in the US.
According to the article, John J. Ray III, the new CEO of FTX and an expert in restructuring, was reportedly observed as someone creating new coins as he and his team attempted to obtain control of FTX's computer systems.
The allegations made by the attorneys take the dispute between FTX reorganization managers in the U. S. and authorities in the Bahamas to a new and even more heated level.
Liquidators in the Bahamas reportedly requested a judge in the United States for permission to access the FTX data maintained by their American counterparts. This request reportedly included trading data, email records, and other information.
According to a document filed with the court on Tuesday, the attorneys stated,
"It is a request for live, dynamic access that would be supplied instantly to the government of the Bahamas and to Messrs."
SBF Aided Bahamas in Minting New Digital Assets
The American lawyers emphasized that SBF authorized withdrawals for all of their clients in the Bahamas to provide support for their charges of potential coordination between the officials in the Bahamas and SBF.
The company said on November 10, only one day before it filed for bankruptcy, that it had begun to enable the withdrawal of Bahamian cash, citing adherence to local regulations as the reason. As a direct result of the event, the cryptocurrency exchange lost several millions of dollars worth of value.
Although the current investigation presents additional allegations of close relationships between FTX and govt employees in the Bahamas, other sources show that SBF also had connections with the government of the United States.
During the election cycle of 2021–2022, the Strategic and Budgetary Forces (SBF) contributed approximately 40 million dollars to support Democratic candidates and causes.
Elon Musk, CEO of Tesla, has speculated that the amount of money the Sanders Super PAC truly donated to Democratic candidates was greater than one billion dollars.
The announcement comes not long after SBF stated its desire to participate in the formation of a new initiative to give back upto $50 billion to FTX's creditors. Following that, on December 12, he was taken into custody in the Bahamas.