America-headquartered crypto exchange Kraken has frozen the accounts connected to “FTX Group, Alameda Research, and their executives,” on its exchange, following authority engagement. 

Specifically, Kraken reportedly revealed via a Tweet on Nov. 13 claiming that the accounts were frozen “to protect their creditors” and also revealed that it “maintains full reserves” and other users’ funds will not be affected, likely seeking to stamp out fears from users that the exchange might come across liquidity problems because of the fund freeze.

“Kraken has spoken with law enforcement regarding a handful of accounts owned by the bankrupt FTX Group, Alameda Research and their executives. Those accounts have been frozen to protect their creditors.”

A Kraken representative additionally disclosed that it had “actively monitored recent developments with the FTX estate” and “are in contact with law enforcement,” saying it froze account access to particular funds “we suspect to be associated with ‘fraud, negligence or misconduct’ related to FTX.”

They aim to deal with each account on a case-by-case manner, and may tap the Bankruptcy Court or trustee as appropriate for proper guidance. 

Kraken’s decision for account freeze was reportedly commenced following crypto exchange FTX’s official announcement on Nov. 11 that FTX Group made up of approximately 130 firms including its sister trading firm Alameda Research submitted the filing for Chapter 11 bankruptcy in America, with its founder, Sam Bankman-Fried, stepping down as CEO.

It further follows a suspected hack on FTX that has the involvement of a Kraken account, Kraken’s chief security officer Nick Percoco revealed on Nov.12 that they are aware of the account owner’s identity and later offered an update that FTX would make a statement regarding the situation “and them utilizing funds from their verified [Kraken] account to complete this transaction.”