(Bloomberg) -- The stunning collapse of the cryptocurrency platform FTX is being investigated by federal prosecutors in Manhattan, people familiar with the probe said.

The US Attorney’s Office for the Southern District of New York is examining the circumstances surrounding FTX’s demise, the people said, asking not to be identified because the probe hasn’t been announced publicly.

FTX’s sudden implosion with $9 billion of liabilities and only $900 million in assets on its balance sheet sent the crypto market into a tailspin last week. The platform filed bankruptcy proceedings, along with 130 entities tied to the company including FTX subsidiaries FTX.US and trading firm Alameda Research, on Friday.

Regulators and investigators will attempt to piece together how one of the world’s largest exchanges collapsed so quickly, including how it handled customer funds, the relationship between subsidiaries and oversight. By the time the market peaked in 2021, FTX had earned the trust of more than 5 million users worldwide, trading more than $700 billion worth of crypto that year alone.

Co-founder Sam Bankman-Fried was also interviewed by Bahamian police and regulators on Saturday, a person familiar with the matter told Bloomberg, as the authorities in the country investigate whether there was any criminal misconduct in FTX’s collapse. The firm is registered in the Bahamas.

Bankman-Fried’s wealth, which stood at around $16 billion at the start of the last week, has vanished along with the reputation of a crypto wunderkind who just recently was regarded as a savior of swathes of the industry.

FTX’s US general counsel didn’t immediately respond to a request for comment.

The SEC is scrutinizing FTX, its American arm FTX.US and Bankman-Fried’s trading house Alameda Research for potential securities violations, Bloomberg reported last week.

The regulator was already probing the crypto empire before its downfall.

While SDNY can prosecute criminal violations and the SEC focuses on civil enforcement, the agencies are known to run parallel investigations.

A spokesman from SDNY declined to comment.

SDNY has spearheaded some of the most high profile cryptocurrency investigations in recent years, including the alleged insider-trading case involving a former Coinbase employee and the prosecution of those behind the bogus crypto empire, OneCoin.

--With assistance from Seng Young Lee.

(Adds scope of probe in fourth paragraph.)

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