Analyzing the FTX Hack

We covered the FTX saga from front to back here, but in this piece, we focus directly on the hack of the exchange.

What Happened

Shortly after FTX filed for bankruptcy, hundreds of millions of dollars began to flow out of the exchange’s remaining balance. Observers on Etherscan documented the hack in real-time throughout the evening of November 11. As the attack continued, FTX’s General Counsel Ryne Miller indicated that FTX intervened and expedited the move of its remaining funds to cold storage. When the dust settled, final estimates for the stolen funds ranged from $338 million (TRM Labs) to $477 million (Elliptic).

Developments

Since Miller shared the news about FTX moving funds to cold storage, the exchange has remained largely silent. On November 12, hours after Twitter users noticed that the hacker’s Tron accounts were funded by an address originating from Kraken, the Chief Security Officer of Kraken tweeted that Kraken knew the identity of the hacker.

In a Twitter conversation between Sam Bankman-Fried (SBF) and Kelsey Piper published on November 16th by Piper on Vox, SBF confirmed that the hack was due to either an ex-employee or malware.