FTX, the cryptocurrency exchange formerly run by Sam Bankman-Fried, has released its first-ever analyst report on its past management. The 43-page document highlights disastrous management and unparalleled amateurism on the part of its former managers.
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FTX’s first report is out
The new management of FTX, chaired by John Ray III, has just published its first-ever analysis report on the past management of the exchangepreviously in the hands of Sam Bankman-Fried and his main acolytes, namely Gary Wang, Nishad Singh and Caroline Ellison.
The 43-page document confirms the disastrous management of the former second largest cryptocurrency exchange platform in the world, and reports unparalleled amateurism on the part of its managers.
As we dive through this report, we learn in particular that private keys and seed sentences exchange clients were not secure. For example, keys giving access to more than 100 million dollars in the form of Ethers (ETH) were stored on one of FTX’s servers in plain textwithout any security procedure limiting access.
Furthermore, contrary to what Sam Bankman-Fried has always asserted, all the cryptocurrencies hosted by the exchange were on hot wallets, where common sense would dictate keeping most of it in cold wallets to protect user funds. In the same vein, unlike the majority of exchanges, FTX had no multi-signature wallet to protect its reservesleaving all of its wallets dependent on a single key.
Still regarding user funds, it turns out that FTX Stored Multi-Billion Dollar Keys on AWS Secret Manager, a cloud service provided by Amazon. According to the report, “ any of the many FTX Group employees with access to AWS Secrets Manager or the Password Vault could access some of the keys and unilaterally transfer the corresponding assets “.
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Regarding the internal management of FTX, we also learn that it is Sam Bankman-Fried, Gary Wang and Nishad Singh who were in charge of all company operations while they were ” just out of college “.
The administrative management of FTX, which, it should be remembered, concerned that of one of the most important crypto companies in the world, was scattered across different applications via “ jumble of documents Google, Slack, shared drives, and Excel spreadsheets “.
The business was managed through QuickBooksan accounting software developed for auto-entrepreneurs, small and medium-sized businesses, that is to say a software totally inadequate for a company like FTX which operates around the world and which hosts billions of dollars.
According to the report, more than 80,000 transactions are still pending in some QuickBooks accounts. Finally, when it declared bankruptcy last November, the company was not even able to provide a complete list of its employees.
New revelations that should not favor the judgment of Sam Bankman-Fried, the outcome of which will be decided next October.
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Source: Report
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Passionate about the world of decentralized finance and the novelties brought by Web 3.0, I write articles for Cryptoast to help make blockchain more accessible to everyone. Convinced that cryptocurrencies will change the future very soon.
Maximilien Prue
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