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Sam Bankman-Fried, Founder of FTX, Arrested in the Bahamas

According to the attorney general of the nation, Sam Bankman-Fried, the creator of the defunct cryptocurrency exchange FTX, has been detained by the Bahamas police.

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On Tuesday, according to The Bahamas' government, he will show up at a magistrates court.

According to the police, Mr. Bankman-Fried was detained for "financial offenses" violating US and Bahamas legal regulations.

Many users were unable to withdraw their money after FTX filed for bankruptcy last month in the US.

Mr Bankman-Fried will be held in custody "pursuant of our nation's Extradition Act," the Attorney General of the Bahamas said in a statement.

"Earlier this evening, Bahamian authorities arrested Samuel Bankman-Fried at the request of the US Government, based on a sealed indictment filed by the SDNY [Southern District of New York]. We expect to move to unseal the indictment in the morning and will have more to say at that time," the US Attorney's office in Manhattan said in a tweet.

Wall Street regulators also said that they would be taking action against Mr Bankman-Fried.

"We commend our law enforcement partners for working to secure the arrest of Mr Sam Bankman-Fried in the Bahamas on federal criminal charges," US Securities and Exchange Commission (SEC) official Gurbir Grewal said in a statement.

"The Securities and Exchange Commission has separately authorised charges relating to Mr. Bankman-Fried's violations of our securities laws, which will be filed publicly tomorrow in the Southern District of New York," he added.

A BBC request for comment did not receive a prompt response from Mr. Bankman-attorney. Fried's.

Former Wall Street trader and ex-Google employee Mr. Bankman-Fried launched FTX in 2019, the company that owns and runs the FTX.COM bitcoin exchange.

With daily trading volume of about $10 billion (£8.15 billion), it rose to the position of second largest cryptocurrency exchange in the world.

In the past, Mr. Bankman-Fried has been compared to a younger counterpart of the famous US investor Warren Buffett. As of late October, his net worth was believed to be more than $15 billion.

He had established himself as a prominent political fundraiser in Washington, DC, purportedly promoting greater crypto regulation and pandemic prevention.

However, after customers withdrew $6 billion from the site in only three days and rival exchange Binance abandoned a rescue arrangement, FTX filed for bankruptcy protection on November 11.

At the same time, Mr. Bankman-Fried gave up his position as CEO of FTX. A court document from last month stated that FTX owed its 50 biggest creditors roughly $3.1 billion.

Mr. Bankman-Fried has recognized that errors were made at the company in a number of interviews and public appearances over the past few weeks, but he has tried to distance himself from claims of illicit activities.

"I didn't ever try to commit fraud."At the Dealbook Summit hosted by the New York Times at the end of last month, he stated.

The FTX collapse happened during a turbulent year for the cryptocurrency market. In addition to other cryptocurrencies, Bitcoin has lost more than 60% of its value this year.

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