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The bankruptcy filing of crypto exchange FTX on Friday did not stop the chaos surrounding the once prominent and trusted crypto trading venue.

Since the filing that included 135 affiliated companies, millions of dollars in crypto have been stolen from the company, which is facing a shortfall between $6 billion and $10 billion. Bahamian officials are also probing the matter.

“I don’t think it’s an understatement to predict that the FTX bankruptcy will be the most complex in U.S. history,” Caitlin Long, founder and CEO of Custodia Bank, told Yahoo Finance Live. “These were leveraged players who were just rolling the dice. This was a casino. Good riddance to them.”

From Friday to Sunday, the global market capitalization for crypto assets is down 3% from $856 billion to $831 billion. Since November 1, it has fallen by 18% from a little over $1 trillion, according to Coinmarketcap.

Here’s what’s unfolded over the weekend.

FTX logo with crypto coins with 100 Dollar bill are displayed for illustration. FTX has filed for bankruptcy in the US, seeking court protection as it looks for a way to return money to users.  (Photo illustration by Jonathan Raa/NurPhoto via Getty Images)

FTX logo with crypto coins with 100 Dollar bill are displayed for illustration. FTX has filed for bankruptcy in the US, seeking court protection as it looks for a way to return money to users. (Photo illustration by Jonathan Raa/NurPhoto via Getty Images)

Friday’s FTX heist

On Friday night, approximately $663 million in crypto mysteriously flowed out of wallets linked to the now bankrupt exchange.

John Jay Ray III, the new chief restructuring officer and CEO who was appointed less than 24 hours before, said in a statement Saturday morning: “Unauthorized access to certain assets has occurred.”

Of the total outflow, about $477 million is estimated to have been stolen, while the remaining has been moved to cold storage by FTX for safeguarding, according to blockchain analytics firm, Elliptic.

“Process was expedited this evening – to mitigate damage upon observing unauthorized transactions,” FTX US’s general counsel, Ryne Miller, said on Twitter.

FTX declined to comment further on the matter.

Meanwhile, the thief has been identified trying to transfer and sell funds through U.S.-based crypto exchange Kraken, the company’s chief security officer said Saturday.

“We are committed to working with law enforcement to ensure they have everything they need to sufficiently investigate this matter,” Kraken said.

How much of those stolen funds will be returned matter. The Financial Times reported that FTX held approximately $900 million in liquid crypto and $5.4 in illiquid venture capital investments against $9 billion in liabilities the day before it filed for bankruptcy.

FTX in the Bahamas

The Bahamas security regulator froze assets of FTX Digital Markets Thursday. On Saturday, the regulator announced FTX had begun processing withdrawals of Bahamian funds for which had not been authorized.

On Sunday, the Bahamian police have also gave a statement declaring they are working with the country’s securities regulator to probe FTX for criminal misconduct.

A person familiar with the matter confirmed with Yahoo Finance that Bahamian law enforcement “are forcing [Sam Bankman-Fried] to stay in the Bahamas” as of Saturday night. This followed speculation that Bankman-Fried and the company’s other top executives — chief technology officer Gary Wang and head of engineering Nishad Singh — were attempting to flee.

Under Chapter 11

FTX will deal with the same “big legal question” as crypto lenders Celsius Network and Voyager, Greg Plotko, a legal partner with Crowell & Moring, told Yahoo Finance. That’s whether crypto held in customer accounts belongs to the customers themselves or the bankruptcy estate.

Unlike Celsius and Voyager, where the line of ownership was less clear, the terms of service on FTX.com states to customers that “none of the Digital Assets in your Account are the property of, or shall or may be loaned to, FTX Trading.”

“There’s also almost certainly massive amounts of criminal fraud that led to this scenario and as a result, we can expect this will be a very messy public trial that will lead to bad publicity and regulatory backlash for the [crypto] industry,” Haseeb Quershi, a managing partner with venture firm, DragonFly Capital, told Yahoo Finance.

Like Quershi’s firm Dragonfly, several larger name crypto hedge funds and market makers have assets trapped on FTX, including Galaxy Digital, Multicoin Capital, Jump Trading, Wintermute, and Galois Capital.

“When you have these situations, there are a lot of institutions that want to exit their positions. They don’t want to be stuck in a bankruptcy for two years, waiting for payouts,” Plotko said. There’s already a lot of holes as to where all the money went. Institutions and individuals may want to sell out.”

FTX’s bid for Voyager Digital’s assets is over

In September, bankrupt crypto lender Voyager announced that FTX through its U.S. subsidiary (FTX US) had made the winning bid for its assets. But that “$1.4 billion offer to buy customer accounts of Voyager Digital is now in serious jeopardy,” Jason DiBattista, head of legal analysis with LevFin Insights, told Yahoo Finance.

Voyager Digital has reopened the bidding process for its assets, according to a press release Friday from its unsecured creditors committee.

At the time of FTX’s bankruptcy filing, Voyager held approximately $3 million worth of crypto tokens it is unable to withdraw.

BlockFi?

Crypto lender BlockFi has also gone silent since officially announcing a freeze on customer withdrawals Thursday night. Since then, a number of customers have noted their BlockFi credit cards no longer work.

While BlockFi isn’t included in the FTX Chapter 11 filing, the firm is expected to be a major creditor after it took an emergency $400 million line of credit from FTX in late June.

As recently as Monday, BlockFi attempted to relaunch its yield product. On Tuesday, COO Flori Marquez announced the firm was “fully operational.” BlockFi did not respond to comments on its status through the weekend.

(This story is developing and will be updated with information)

David Hollerith is a senior reporter at Yahoo Finance covering the cryptocurrency and stock markets. Follow him on Twitter at @DsHollers

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