Embattled Crytpo Exchange FTX Loses Australian Business Licence: Here’s What Happened

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The Australian securities regulator announced on Wednesday that it has revoked the license of FTX, the local branch of the collapsed US-based cryptocurrency exchange, as reported by Reuters. The cancellation of the license took effect on July 14. FTX, which was previously valued at $32 billion in January 2023, filed for bankruptcy protection in the United States in November, citing its inability to fully repay customers who had deposited funds on its exchange.

Since then, the cryptocurrency industry has faced increased scrutiny from regulators worldwide, while FTX founder Sam Bankman-Fried is facing a criminal lawsuit by the US government on charges of fraud. Bankman-Fried has denied the allegations and pleaded not guilty.

ALSO READ: G20 Crypto Watchdog Publishes Final Recommendations For Fundamental Safeguards To Avoid FTX-Like Crashes

The Australian Securities & Investments Commission (ASIC) suspended FTX’s licence in November, with the suspension originally set to last until May. The license allowed FTX to engage in derivative and foreign exchange contracts with retail and wholesale clients.

According to ASIC, FTX Australia will be allowed to continue providing limited financial services specifically for terminating existing derivatives with clients until July 12, 2024.

ALSO READ: FTX Sues Former Lawyer Over Involvement In Aiding Bankman-Fried’s Fraud, Suppressing Whistleblowers

The license cancellation does not affect FTX Australia’s obligations to remain a member of the Australian Financial Complaints Authority or its arrangements for compensating retail clients, ASIC stated.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.

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