FTX Halts User Accounts Access Following Kroll Data Breach

FTX is a defunct crypto exchange that went down in flames following revelations of massive controversies. The bankrupted firm was hit by a data breach on Kroll. Despite its current standing as a defunct trading platform, FTX has continued to face hack attacks and threats. Kroll is a claims agency that is working with FTX for its bankruptcy proceedings.

However, the firm was hit by a massive data breach attack on X as per the latest updates shared by FTX account on the social media platform.

As per the update, FTX claimed that non-sensitive data related to its consumers have been stolen by the hackers. To deal with the matter, the firm has decided to suspend the accounts of affected users on its platform. The firm has shared that the attack took place in the form of Sim-swap where hackers targeted one employee of Kroll.

In this manner, unauthorized individuals were able to gain access to the personal data and files of FTX claimants. Meanwhile, FTX has stated in its notification that internal systems, sensitive data, and other assets were not affected.

FTX claimants who have reserves locked on the defunct trading platform are now faced with another issue. The bankrupted firm has decided to suspend the accounts of affected users as a precautionary measure.

The suspended accounts are linked with user claim portal on the exchange. Another update from FTX on X has recounted that these changes were made to ensure the security and protect its consumers from exposure to phishing attacks or other risks.

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The firm has also issued a warning for the claimants to stop altering or modifying their current claims. At the same time, the firm has alarmed the consumers regarding any emails that may be sent from impersonating parties.

There is an increased chance of fraudulent activity associated with defrauding the claimants who are currently awaiting conclusion of the pending bankruptcy lawsuit. The incident highlights the ongoing struggles of FTX in dealing with bankruptcy proceedings.

Catastrophic Collapse of FTX

Alameda Research was the sister firm of FTX that went down with the crypto trading forum. Former engineer at Alameda Adittya Baradwa has shared some insights into the abysmal fall of FTX.

Baradwa shares that the company retained an air of mystery as it had not officiate a physical location for headquarters. He also revealed that FTX’s policy to enforce KYC, crypto custody, and operating a derivatives exchange went against its motto of favoring decentralization.

He shared the expansion plans from SBF regarding moving the firm from California to Bahamas and shifting from crypto to medicine. The former engineer also maintained SBF has plans to set up a new vaccine factory to eradicate malaria.

Barawada claimed that the former executive harbored plans to expand exponentially beyond Berkeley office to pursue welfare plans. However, the unrealized plans of Alameda and FTX were crashed with allegations of bribery, unsanctioned political donations, and embezzlement of consumer funds. Barawada also talked about reckless risk management, technical debt, and wasteful spending.

The demise of FTX has affected the entire crypto sector and the case is still pending in court with major institutions and creditors at the helm of the lawsuit.

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