FTX lends $120M to recently hacked Japanese Crypto Exchange Liquid


Japanese cryptocurrency exchange, Liquid
Group Inc. and Sam Bankman-Fried’s cryptocurrency exchange, FTX Trading
Ltd, owner and operator of FTX.COM, announced on August 26, 2021 the closing
deal of a $120 million debt financing, due to its expected $100 million hack
last week.
By this financial merger, both of the
crypto exchanges expected to attain exponential progress and accomplishment to best
serve the crypto ecosystem, with the help of Liquid’s regulatory framework and
FTX sophisticated financial expertise. Liquid have also entered good faith
discussions with FTX in pursuit of further collaborative opportunities.
"We could not be more excited to
explore opportunities to leverage FTX's expertise in trading platforms with
Liquid's experience working within the regulatory frameworks in Singapore and
Japan,” said the COO of Liquid
Group, Seth Melamed in Thursday’s announcement. “By collaborating with
FTX, we see enormous opportunities to drive innovation and change the future of
finance with blockchain technology," he added further.
On the other hand FTX’s owner
Bankman-Fried commented on FTX’s coming to Liquid’s rescue, “Helping the wider
crypto community and a fellow team of like-minded builders was the key benefit
for us,” he added, “We look forward to Liquid continuing to lead the way in
crypto regulation and emerging from this stronger than before.”
The exchange
said that the financing will also improve its key regulatory metrics, “which
further corroborates its ongoing licensing opportunities in the key
jurisdictions of Japan and Singapore.”
Last week, Japan-based
Liquid Global revealed the news of disastrous hack via Twitter that its
hot digital wallets were compromised, resulting in a loss of at least $100
million in various cryptocurrencies, such as BTC, ETH, and XRP.
The hack brought in light the need for stronger security system in the cryptocurrency network, which regulators across the globe have pushed for recently. In its latest incident update, Liquid reassured its customers that they will not suffer any losses due to the hack. The exchange also asserts that consumers' personal data “was not compromised in any manner” during the hack.
“Security and
regulation have always been central to our operations as an exchange,” stated
Bankman-Fried. “As regulators get more active and the space continues to grow,
there are more opportunities to become licensed, and we fully expect the
security of user funds to be a key consideration in order to secure those
licenses.”
Liquid Global,
operated by Quoine Corporation, is looking forward to accelerate its roadmap
not only in Japan but throughout the world in crypto market, of their
initiatives to bring innovative products. It was the second major hacking incident
in the crypto space this month, following on the heels of a
record-breaking $610 million exploit of cross-chain protocol Poly Network
on August 10.
The Poly
Network’s hack was one of the more unusual in the history of digital assets,
with the hacker named "Mr. White Hat", ultimately deciding to return
the stolen money.

Joyashree Dey
CBW - External Analyst
INDIA