Is SBF behind the FTX wallet hack?

As I have looked into the SBF and FTX mess, I have started to form a theory of my own. And yes, the headline spoils it, I think SBF is behind the FTX wallet hack. Let me take you along and you can make your own judgment.

Let us look at the events

On November 11th Samuel Bankman-Fried resigned from his position as CEO of 130 companies, including FTX. It was done at the same time as he filed for chapter 11 bankruptcy. This more or less is at the same time, or just before, the unauthorized transactions occurred.

It was reported on November 12th that during the last 24 hours a total of $659 million where moved from both FTX and FTX US. Of these $477 million is suspected to be stolen.

In a November 16th interview SBF comments on the hack and had this to say:

I don’t know exactly who because they shut off all access to the systems when I was halfway through exploring it. I’ve narrowed it down to eight people. I don’t know which one it was but I have a pretty decent sense. -SBF

He followed it up by saying he believes it was done by "either an ex-employee or somewhere someone installed malware on an ex-employee’s computer". And then he suddenly does not have access any longer to the data so SBF is unable to follow through on his investigation.

On November 17th the Securities Commission of The Bahamas confirms they ordered SBF and Gary Wang to transfer funds on November 12th from FTX to an account controlled by them. It is believed they are holding around $330 million in $ETH. But I have not been able to confirm that wallet belongs to them. But going by the reported figure from before of $477 million being stolen, it leaves $182 million. And it has been confirmed the amount transferred to them where over $100 million so it is probably between $182 and $330 million.

There is also the rumour? about the Bahamians ordering SBF to mint ~$300 million in $FTT tokens for one reason or another. This has been denied in a public statement from the Securities Commission. But after reading eh statement I could not see any direct refutal, only an indirect one.

Then there is also the backdoor that allowed the transfer of funds from FTX to Alameda Research, without them leaving any trace.

My thought process

While SBF should stop having any access to FTX, its systems, or any other company evidently after he resigned. This is apparent that this is not the case. He still clearly has access to the system after he has resigned. Proven by the fact that he facilitated some of the moving of funds on the day after he resigned.

And he also may, or may not, have had access to the system so he could mint ~$300 million in new $FTT tokens. If this is true or not does not really matter, as it is already proven he has access and has moved funds. This would merely be the second time he would have access to the systems when he no longer should have had access to them.

SBF has before his November and December media tour been portrayed as the smartest man in the room. But during his media tour, he suddenly was transformed into a fumbling fool who had no idea about anything and was in over his head not knowing what he was doing. But now suddenly he is competent enough to carry out an investigation into the theft, and just as he was about to find the culprit he unfortunately no longer has access to the data to be able to continue the investigation.

And to no one's surprise, he claims the evidence points to a former employee or someone who has had access to an ex-employees computer. Why would an ex-employee have access to their system still? I find that extremely strange and hard to believe, but I guess with FTX and SBF anything is possible. But I think it is very unlikely, judging by how the rest of the world is working. I see this more as SBF trying to create some false narrative, painting someone else as the guilty party.

If finding out who was responsible for the hack was as simple as he makes it out to be. Why have the people in charge not already found the guilty party? They, I assume, would be very keen on knowing who it is that has run away with a truckload of money from FTX. Can it be so simple that they assume that the Bahamians have all of the $600+ million? I at least would not be confident in assuming such a thing. And presumably, it would be as easy as sending an email or making a phone call to find out.

And let us not forget that SBF is being fingered by two of his friends as the person in charge of the whole misappropriation of funds, wire fraud, and everything else he is being accused of. And if he is found guilty he will presumably be going away for a long long time. So why not take a few $100 million extra as a nesting egg if he ever is patrolled, or let out early. I mean even if he is found guilty of theft it would probably not make any big difference for him. It would simply be one more charge levied against him, one more line on an already long list.

I have to say, if this was an episode of a police show. I would be hard-pressed not to just slap the cuffs on SBF and throw away the key at this point. But I will admit that if it is not SBF, the timing of this hack is extremely, extremely lucky. Being able to, or fortunate enough to steal the funds at the same time that others also are transferring funds from FTX. That is definitely next level of luck os foresight.

I would love to hear your thought, do you agree with my reasoning? Or do you think I am jumping to conclusions regarding SBF? Please sound off in the comment section down below. If you would like to support me and the content I make, please consider following me, reading my other posts, or why not do both instead.

See you on the interwebs!

Picture provided by: Fair Use

Resources

1. https://cointelegraph.com/news/ftx-reportedly-hacked-as-officials-flag-abnormal-wallet-activity
2. https://cryptobriefing.com/bahamas-government-says-it-ordered-sbf-hack-ftx/
3. https://twitter.com/BeosinAlert/status/1592524028010721280