FTX’s AFS license suspended by ASIC

Steffy Bogdanova
November 16, 2022 9:56 am

The Australian Securities and Investments Commission has suspended the Australian financial services licence of FTX Australia Pty Ltd, the regulator announced on Wednesday. The license is suspended until 15 May 2023.

According to the official announcement, the crypto company’s Australian arm can continue to provide limited financial services which are related to termination of existing derivatives with clients until 19 December 2022

On 11 November 2022, the company was placed into voluntary administration. FTX Australia and its subsidiary FTX Express Pty Ltd, not regulator by ASIC, were appointed administrators John Mouawad, Scott Langdon and Rahul Goyal of KordaMentha .

Furthermore, FTX Trading Limited, West Realm Shires Services Inc (trading as FTX US) and other affiliates filed for Chapter 11 bankruptcy protection in the US last week.

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The crypto exchange FTX collapsed last week following a liquidity crunch and a subsequent hack which drained millions of dollars from the company which was already in a tough spot. As allegations of customer fund misappropriation surfaced and prompted regulatory scrutiny, investors are reluctant to provide capital to the exchange.

Last week, FTX founder Sam Bankman-Fried, stepped down as CEO. The exchange has brought in expert lawyer in company restructuring, John J. Ray III, to replace him.

ASIC stated:

ASIC is monitoring this situation closely and speaking regularly with international regulators and the external administrators.

ASIC encourages clients of FTX Australia to carefully monitor the situation and look out for updates by the FTX Group, as well as from FTX Australia’s administrators.

LeapRate Analyst

Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
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