FTC Probes $200M Bitmark Crypto Hack
In what is the first investigation into cryptocurrency markets, the Federal Trade Commission (FTC) is looking into the Bitmark currency exchange during the December 2021 hack that cost consumers $200 million.
According to an FTC order filed Wednesday (Aug. 11), the agency rejected a request from Bitmart operator Bachi.Tech Corp. and Spread Technologies LLC to quash the agency’s attempt to compel them to disclose information.
“The investigation includes inquiries about Bitmart’s representations regarding its advertised exchange services,” the FTC said in the filing.
It adds that it is also investigating whether “consumers have been denied access to their accounts” as well as “concerns about the security of customer accounts, particularly in light of the … 2021 security breach that resulted in consumer losses of more than $200 million in cryptocurrency.”
Read More: $196M Bitmart Hack Shows Crypto’s Weakness
According to the document, Bachi and Spread argued that the FTC cannot compel Bachi.Tech to produce materials located in other countries, that the information it seeks is irrelevant and that the requests are too broad and would impose an undue burden.
Bitmart disclosed the hack on December 4 last year. At the time, the company said $150 million in funds had been stolen, though cybersecurity experts later put the figure closer to the $200 million listed by the FTC.
This news comes three weeks after another first in the world of US crypto enforcement. On July 21, the US Department of Justice charged a former Coinbase executive and two other men in what it said was the first insider trading case involving cryptocurrency.
See also: Feds Charge 3 in First-ever Crypto Insider Trading Case
Ishan Wahi, a former product manager at Coinbase, his brother Nikhil Wahi and Ishan’s associate Sameer Ramani were all charged with wire fraud conspiracy and wire fraud.
These charges relate to an alleged scheme to commit insider trading in cryptocurrency assets by using inside information at Coinbase about which cryptoassets were scheduled to be listed on the company’s exchange.
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