DOJ Seeks Seizure of $16M in Crypto Linked to FTX from Binance After Year-long Investigation

The U.S. Department of Justice (DOJ) has initiated a civil forfeiture complaint to seize approximately $16 million in cryptocurrency held in a Binance account.

The move follows a year-long investigation into funds allegedly linked to bribes authorized by Sam Bankman-Fried, the former CEO of the collapsed crypto exchange FTX.

Court documents reveal that the funds, composed of Internet Computer (ICP), Avalanche (AVAX), Ripple (XRP), Cardano (ADA), and Solana (SOL) tokens, are suspected of originating from illicit transactions.

Solana Accounts for Half of Holdings

Notably, Solana accounts for over half the holdings, valued at $8.5 million.

The account’s total value has surged amid a broader crypto market recovery, doubling to $16 million since the initial transfers.

The rally was partly driven by optimism surrounding U.S.-listed spot Bitcoin and Ethereum exchange-traded funds.

The investigation traces the roots of the case to November 2021, when Bankman-Fried allegedly orchestrated a $40 million USDT payment from Alameda Research wallets to bribe Chinese officials.

The goal was to unfreeze $1 billion worth of cryptocurrency assets held on two China-based exchanges.

The funds were reportedly funneled through several private wallets before ending up in a Binance deposit account.

Authorities flagged the Binance account for “suspicious activity,” noting nearly daily deposits of stablecoins and Bitcoin that were swiftly converted into other cryptocurrencies via over-the-counter trades.

These patterns prompted the DOJ to link the assets to the bribery scheme.

This development adds another layer to the ongoing fallout from FTX’s collapse.

Bankman-Fried, already convicted on seven criminal counts, is currently serving a 25-year prison sentence.

He has appealed the conviction, with his legal team arguing that the trial was biased against him.

The bribery allegations, initially part of his indictment, were separated from the main trial, which focused on fraud and conspiracy charges.

Cyprus Extends Suspension of FTX’s European Arm

The Cyprus Securities and Exchange Commission (CySEC) has extended its suspension of FTX’s European division, FTX Europe, for another six months.

The decision, announced on November 5, delays the firm’s ability to operate until at least May 30, 2025.

The extension prohibits FTX EU from offering services, advertising, or accepting new clients, though it allows the platform to complete transactions and return funds to existing clients.

This marks the fourth suspension extension since CySEC first halted FTX Europe’s operations in November 2022, following FTX’s bankruptcy in the United States.

At that time, FTX had operated in the European market for only eight months, offering regulated investment services for multi-asset derivatives.

Meanwhile, in the US, the Justice Department is seeking the return of up to $13.25 million in political contributions linked to former FTX executives, as revealed in a recent federal court filing.

Judge Lewis Kaplan, who is overseeing the criminal proceedings against former FTX CEO Sam Bankman-Fried and his associates, approved the government’s request for an extension until January 15 to negotiate with various political action committees (PACs).

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