Based on its licence, FTX Australia is authorized to deal in, market and provide general advice on derivatives and foreign exchange contracts.
FTX Australia, the local subsidiary of bankrupt cryptocurrency exchange FTX, has lost its license to operate in the Asia-Pacific country. Australian Securities and Investment Commission (ASIC) announce Revocation of the license on July 19th.
Previously, it had suspended the license in November after FTX Global declared bankruptcy. As of the time the license was suspended, FTX Australia king About 30,000 retail customers. It also served 132 Australian companies. Thus, many were surprised to discover that FTX Australia was operating under an unspecified Australian financial services license.
The controversial FTX Australia license
FTX Australia did not obtain its license directly from ASIC. Instead, it acquired the license through a series of acquisitions. original company has happened License in 2008. Thus, the license was not specific to its services in Australia.
Based on its licence, FTX Australia is authorized to deal in, market and provide general advice on derivatives and foreign exchange contracts. This can be offered to retail and wholesale customers. However, the license did not specify crypto assets or the operation of crypto asset exchanges.
It didn’t take long for ASIC to stop licensing the entity after the parent body declared bankruptcy in the Bahamas in November. The license suspension was set to expire by May 25, 2023, before being extended through July 24. Then, ASIC pulled the license completely on July 19th with the revocation effective July 14th.
FTX Australia will continue to provide limited financial services related to the termination of the derivatives service on July 12 of next year. According to the regulator, the company will still need to compensate its customers.
FTX may be relaunched as a new entity
Meanwhile, the global FTX entity reported recovering about $7 billion in liquid assets. However, about $8.7 billion of clients’ assets were misappropriated, causing a shortfall of about $2 billion. According to CEO John Ray, the search for additional assets continues.
Despite this, FTX can be relaunched as a completely new exchange. Again, John Ray notes that the company has “begun the process of getting interested parties to restart the FTX.com exchange. Also, FTX’s legal team has reasoned that a new exchange could be launched by Q2 2024.”
It appears as though Ray and the rest of the debt restructuring team see a reboot as the best way to ensure creditors are paid to the fullest.
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