BitGo CEO Reveals Alameda Tried to Redeem 3,000 wBTC Days Before Bankruptcy
Alameda, a cryptocurrency exchange platform, filed for bankruptcy earlier this week after suffering a significant hack. However, according to BitGo CEO Mike Belshe, the company had attempted to redeem 3,000 wBTC (wrapped Bitcoin) just days before the bankruptcy announcement.
Belshe made the revelation in a tweet on Wednesday, stating that Alameda had reached out to BitGo, a digital asset trust and security company, on May 9th to redeem the wBTC. BitGo, however, was unable to complete the transaction due to the “unusual” nature of the request and the large amount of funds involved.
“We were asked to redeem 3,000 wBTC (approx $30m) from Alameda just days before they filed for bankruptcy,” Belshe tweeted. “While we have a process for large redemptions, the request was unusual and we required additional time to assess the risk of the transaction. Ultimately, we were unable to complete the redemption before their bankruptcy filing.”
It remains unclear whether the attempted redemption was related to the hack that Alameda suffered just days later. The company has not yet released any details about the attack or the amount of funds that were lost.
The news of Alameda’s bankruptcy and attempted redemption has sparked concern among users of the platform, as well as the larger cryptocurrency community. Many are questioning the security measures in place at the exchange and the possible involvement of insider trading.
“This is a reminder that even the most well-respected and established exchanges are not immune to hacks and insider trading,” said cryptocurrency expert and analyst Alex Kim. “It’s important for users to always be vigilant and do their due diligence when choosing a platform to trade on.”
The incident serves as a cautionary tale for both exchanges and users of cryptocurrency, highlighting the importance of proper security measures and risk management. It is not yet known how the bankruptcy and hack will impact Alameda’s users and the future of the exchange.
Filed under: Bitcoin - @ December 19, 2022 3:14 pm