Another Extension: CySEC Suspends FTX EUs License until September

The Cyprus Securities and Exchange Commission (CySEC) has yet again extended the suspension of the license of FTX (EU) Ltd, the locally regulated subsidiary of the now-collapsed cryptocurrency exchange.

The Suspension of FTXs EU License

Announced today (Tuesday), the latest license suspension will last until 30 September 2024. The license of the EU unit of FTX was originally suspended in November 2022. Since then, the regulator has extended the suspension multiple times.

The European entity of FTX initially gained approval from the Cyprus regulator last March and obtained full authorization as a CIF in September. Though the Cypriot license did not allow the exchange to offer crypto directly, it could provide derivative products. Additionally, the license was essential as the exchange can passport it to provide services within the entire European Economic Area.

Although FTX EU is already undergoing bankruptcy proceedings, the Cypriot regulatory notice highlighted that, as long as the license is suspended, the exchange cannot provide/carry out investment services/activities, enter into any business transaction with any person, and accept any new client; nor advertise itself as a provider of investment services.

Fall of a Crypto Empire

FTX and over a hundred of its affiliates filed for bankruptcy in November 2022 in the United States, days after the shady business practices of its former CEO, Sam Bankman-Fried, surfaced. Bankman-Fried, once recognized as a crypto billionaire, was convicted of multiple criminal charges and has been sentenced to jail for 25 years. Last week, the lawyers of Bankman-Fried appealed against the sentencing and conviction.

Multiple other top bosses of FTX and its affiliate, Alameda Research, pleaded guilty to civil and criminal charges and are now awaiting sentencing. All of them testified against Bankman-Fried in the trial.

Meanwhile, two US senators, Elizabeth Warren and Chuck Grassley, recently demanded a full accounting of the interactions between the Chairman of the CFTC, Rostin Behnam, and Bankman-Fried, concerning the nature of their relationship before the collapse of the crypto exchange.

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FTX EU launches withdrawal website to pay back European users

FTX EU was only approved by the Cyprus regulator in March, 2022, about seven months before FTX collapsed in November.

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Exclusive: FTX Europe Launches New Website for Customer Balance Withdrawal

<p class="MsoNormal">FTX Europe, the European subsidiary of bankrupt cryptocurrency exchange, FTX, has created a new website for its customers to withdrawal their balance from the platform. The new domain name, https://ftxeurope.eu/, was approved by the Cyprus Securities and Exchange Commission (CySE).</p><p class="MsoNormal">Finance Magnates learned the new domain will offer no products or any other services apart from balance withdrawal.</p><p class="MsoNormal">"Please be informed that our new domain, www.ftxeurope.eu, has been approved by our regulator CySEC as you have well identified. The website will only be used for all FTX EU LTD clients to be able to claim their FIAT balances. There will be no services or products offered via this website," FTX Europe told Finance Magnates via email. </p><p class="MsoNormal">Finance Magnates' check on the new domain brings up a dialogue box asking users to "log in to your FTX EU account in order to see your balance and to request a withdrawal." On the other hand, www.ftx.com/eu remains unresponsive at this time.</p><blockquote class="twitter-tweet"><p lang="en" dir="ltr">FTX EU, a solvent entity, is now paying out its customers on <a href="https://t.co/MEw8Oz8vTk">https://t.co/MEw8Oz8vTk</a>.Note: Almost none of FTX's EU citizens are FTX EU users, because for some reason, FTX EU only onboarded customers registered from March 2022. <a href="https://t.co/gu56Vysvlc">pic.twitter.com/gu56Vysvlc</a></p>— FTX 2.0pium (FTX Creditor) (@AFTXcreditor) <a href="https://twitter.com/AFTXcreditor/status/1641481931614289920?ref_src=twsrc%5Etfw">March 30, 2023</a></blockquote><p class="MsoNormal">Finance Magnates' check on CySEC's public register shows https://ftxeurope.eu is an approved domain owned by FTX EU. </p><p class="MsoNormal">Finance Magnates also found that CySEC earlier this month modified the public profile of FTX EU on its register. As of press time, the Cypriot regulator is yet to response to request for a comment.</p><p class="MsoNormal">FTX Europe Faces CySEC Suspension</p><p class="MsoNormal">FTX EU, which is headquartered in Switzerland and has regional headquarters based in Cyprus, <a href="https://www.financemagnates.com/cryptocurrency/news/ftx-gains-cysec-license-to-offer-regulated-crypto-products-in-europe/" target="_blank" rel="follow">first gained CySEC approval</a> in March 2022 to offer regulated cryptocurrency products in Europe. The company had announced it would provide its services through the domain ftx.com/eu. FTX EU was previously K-DNA Financial Services Limited but was renamed after acquisition by the cryptocurrency exchange.</p><p class="MsoNormal">However, in the aftermath of <a href="https://www.financemagnates.com/cryptocurrency/ftx-the-rise-the-fall-and-the-reaction/" target="_blank" rel="follow">the collapse of FTX</a> in November last year, <a href="https://www.financemagnates.com/cryptocurrency/ftxs-cysec-license-suspension-likely-to-start-wider-regulatory-audits/" target="_blank" rel="follow">CySEC suspended the operating license</a> of FTX EU which obtained full authorization as a Cyprus Investment Firm (CIF) two months earlier. The CIF license enables FTX EU to offer crypto derivatives products and not direct exchange of digital assets. </p><p class="MsoNormal">CySEC said it suspended the subsidiary’s license for violations of the country’s regulated markets laws by having unsuitable members on its Management Board and not meeting the organization's requirements for safeguarding clients’ assets. Additionally, the regulator explained that the decision was taken “for the protection of investors and the orderly operation of the market,” and gave the subsidiary firm one month to take necessary actions to comply with the provisions.</p><p class="MsoNormal">However, in late December, <a href="https://www.financemagnates.com/cryptocurrency/cysec-extends-ftx-eus-cif-license-suspension-to-march-2023/" target="_blank" rel="follow">CySEC extended the suspension</a> of FTX EU’s license to March 2023, in order to allow the subsidiary firm “to proceed with the necessary actions in order to comply with the relevant provisions of the Investment Services and Activities and Regulated Markets Law of 2017.”</p><p class="MsoNormal">Announcing the extension, CySEC said the subsidiary could “complete all its own transactions and those of its clients which are before it, in accordance with client instructions.” Moreover, the firm could return all funds and financial instruments belonging to clients, the regulator added. </p><p class="MsoNormal">Finance Magnates’ check on the CySEC register shows that the FTX EU Limited license is still under suspension. </p> This article was written by Solomon Oladipupo at www.financemagnates.com.

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FTX Wants to Sell Solvent Subsidiaries, Says It Already Received ‘Dozens’ of Inquiries

The solvent units include LedgerX, or FTX Derivatives, as well as FTX Japan, FTX Europe, and Embed Business.

Continue reading FTX Wants to Sell Solvent Subsidiaries, Says It Already Received ‘Dozens’ of Inquiries at DailyCoin.com.

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FTX Seeks Court Approval To Dispose 4 Businesses

In the annals of cryptocurrency history, 2022 will be remembered as the year of failures and bankruptcies. A number of well-known companies, including FTX, 3 Arrows Capital, Celsius, Terraform Labs, Voyager, and Vauld, as well as Genesis, and Alameda Research, have all bowed out. Investors had to face the weight of their breakdown, which shattered the entire crypto […]

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FTX EU Secures License from CySEC in European Expansion Move

Following its acquisition of a local investment firm, FTX Europe said it has received the Cyprus Investment Firm License as granted by the country’s Securities and Exchange Commission (CySEC). (Read More)

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FTX Is Coming to Europe

FTX announced its transatlantic expansion by establishing an FTX Europe unit.

Continue reading FTX Is Coming to Europe at DailyCoin.com.

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FTX Seeks to Recover $300M Paid to the Leadership of Its European Affiliate

FTX bankruptcy lawyers have sought court orders to recover $323 million paid to the leadership of FTX Europe, a subsidiary of the now-bankrupt cryptocurrency exchange. The amount is believed to be part of a larger sum of money allegedly misappropriated by the former FTX executives.

According to a court filing yesterday (Wednesday) seen by CoinDesk, Sam Bankman-Fried, the former FTX CEO and the FTX Group, allegedly paid the money for the acquisition of DAAG, a Swiss company that was later renamed FTX Europe.

According to the lawyers who submitted the matter on behalf of FTX and Maclaurin Investments, an entity owned by Alameda Research, FTX Europe had limited resources.

FTX Traces Customers' Assets

FTX is now seeking that a Delaware-based bankruptcy court handling its bankruptcy proceedings order that the funds paid to the individuals overseeing FTX Europe, Patrick Gruhn, Branson Willaims, Robin Matzke, and Lorem Ipsum, be returned to the company.

On top of that, FTX bankruptcy lawyers informed the court that the leadership of FTX Europe received approximately $100 million for the acquisition of K-DNA, a licensed entity in the European Economic Area, which was later integrated with FTX Europe for €2 million.

The FTX Group has also asked the court to stop the remaining payments of more than $50 million to the FTX Europe's leadership. In the filing, the exchange’s lawyers claimed that FTX Europe is not valuable and cannot be sold.

FTX Europe

In April, a court in Switzerland granted FTX permission to explore the potential sale of FTX Europe. The permission was granted following a petition filed by FTX Europe to restructure its debt amid the bankruptcy filing by the parent company, FTX.

Earlier in the year, FTX Europe announced that it had initiated processes to allow its users to withdraw funds. The subsidiary had only been in operation for eight months before the collapse of its parent company FTX.

FTX’s bankruptcy team released a report in June that the cryptocurrency exchange had so far recovered $7 billion out of the $8.7 million owed to customers. In the report, the team noted that the extensive commingling of funds complicated the efforts to recover the remaining assets, Finance Magnates reported.

The former exchange’s executives reportedly misappropriated customers' funds in speculative trading, political donations, and investments in luxury real estate in the Bahamas. Sam Bank-Man Fried is facing several federal charges related to fraud and conspiracy.

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CySEC Extends FTX Europe's License Suspension until September End

On Wednesday, the Cyprus Securities and Exchange Commission (CySEC) confirmed an extension on the suspension of FTX (EU) Ltd's authorization until the end of September 2023.

FTX Europe's License Suspension

The Cyprus Investment Firm (CIF) license was initially suspended on 11 November 2022 following the bankruptcy filing of FTX.com, Alameda Research, and more than 130 affiliates. The suspension was then extended until the end of March 2023, which has now been extended even further.

FTX Europe is headquartered in Switzerland and obtained a license from the CySEC in March 2022. Though the Cypriot license has not allowed the exchange to offer crypto directly, it can provide derivative products. Additionally, the license has been essential as the exchange can passport it to provide services within the entire European Economic Area (EEA).

FTX Europe Starts to Process Withdrawals

While the US bankruptcy proceedings of FTX and its affiliates are ongoing, FTX Europe recently launched a separate website to facilitate withdrawals for its customers. However, the entity did not reveal the number of withdrawals it processed in two weeks. Moreover, FTX Japan initiated withdrawals for its customers and processed over $50 million in digital assets and fiats within 24 hours.

Earlier, the CySEC Chair issued a statement confirming the regulator's role in ensuring swift withdrawals.

"We are grateful to the FTX Group Administrators for their collaboration and support towards these efforts. Safeguarding the interests of investors is of paramount importance, and CySEC will continue to hold FTX EU Ltd to account to ensure all withdrawal requests are processed swiftly and appropriately," said Dr George Theocharides, the Chair of CySEC.

FTX Europe operated relatively independently from its tainted Bahamas-based partner, FTX.com. At the request of FTX management, a US court also permitted the sale of FTX Europe and three other FTX entities, FTX Japan, LedgerX, and Embed. Though the FTX management previously revealed that more than 110 potential buyers are willing to acquire these businesses, there is no additional update on any potential deal.

Darwinex Zero goes live and VTB Forex adds CNY pairs; read today's news nuggets here.

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Backpack Exchange and FTX clash over FTX EU ownership

The ownership of FTX EU has become a point of contention between Backpack Exchange and the FTX estate.

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Backpack Exchange acquires FTX EU, plans Q1 2025 launch

As part of the acquisition, Backpack EU will be responsible for distributing court-approved bankruptcy claims to FTX EU customers.

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FTX to Launch Claims Portal for Customers ‘In the Coming Weeks’

The bankrupt cryptocurrency exchange, FTX, has said it will launch a portal “in the coming weeks” for customers owed by the global crypto trading platform, FTX.com and its affiliates to state their claims. The exchange stated this on a website, claims.ftx.com, where the portal will be hosted.

FTX Plans to Repay Customers

On June 28th, John Dorsey of the bankruptcy court in the District of Delaware, United States, ordered that customers of the exchange and its affiliated entities including its sister trading firm, Alameda Research, submit their ‘proofs of claim’ on or before 4 pm EST on September 29, 2023.

These customers include individuals, corporations, joint ventures and trusts, among others, who were owed funds in the form of fiat currency, cryptocurrency or other forms of assets before FTX filed for bankruptcy protection in November.

The order follows a customer bar date motion filed by FTX and its affiliates on June 14, 2023, requesting the court to permit the deadline for customers to file the proofs of claim. The bankrupt exchange also sought the court's permission for the method it intended to employ to obtain the claims.

Following the approval of the order, FTX announced on Twitter that it is working to finalize claims through the portal, the claims.ftx.com website. A message on the website further informs customers they will be updated with the information once available.

The FTX Debtors’ “Customer Bar Date” has been set for September 29, 2023 at 4 PM ET. To streamline the process for customers, the FTX Debtors are finalizing an online claims portal at https://t.co/DkYi2hDLbI. FTX Debtors will announce when the portal is active.

“This site will serve as the Debtors’ Customer Claims Portal which will be launched in the coming weeks as a result of recent amendments to the filed schedules. Customers will be notified through email and the official FTX Twitter account when the portal is open,” a message on the website reads.

FTX EU and FTX Japan Are Exempt

Meanwhile, the bankruptcy judge’s court order exempts customers of FTX EU and FTX Japan who have already withdrawn their funds from filing the proofs of claim. On top of that, the order prohibits customers from filing their claims against any of the Founders of FTX and its subsidiaries, including Sam Bankman-Fried, the Founder and former CEO who is facing charges from US prosecutors.

This is even as FTX EU, whose license has been temporarily suspended by the Cyprus Securities and Exchange Commission, recently launched a new website for its customers to request balance withdrawals, Finance Magnates reported. Earlier in the year, FTX Japan’s users withdrew $50 million within a day after the balance withdrawal process resumed.

Bankman-Fried’s crypto empire crumbled in November, which was triggered by a bank run following the revelation that the now-bankrupt FTX.com was using its customers’ assets to prop up Alameda Research.

USD LIBOR ceases; MetaTrader Web Terminals change addresses; read today's news nuggets.

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FTX EU Withdrawals to Go ‘Swiftly’, CySEC Says

<p class="MsoNormal">CySEC announced on Monday that FTX EU LTD initiated the procedures for customers to request final balances before withdrawing fiat funds from segregated accounts. The market supervisor believes the withdrawal process will go 'swiftly.' </p><p class="MsoNormal">FTX EU Begins Fiat Currency Withdrawal Process for Clients</p><p class="MsoNormal">In response to FTX EU announcing its initiation of processes to return segregated funds to investors under Cyprus Law, Dr George Theocharides, the Chair of CySEC, stated the supervisor is glad that regulatory efforts have led to this favorable outcome, following months of investor uncertainty and concern. </p><p class="MsoNormal">"We are grateful to the FTX Group Administrators for their collaboration and support towards these efforts. Safeguarding the interests of investors is of paramount importance and CySEC will continue to hold FTX EU Ltd to account to ensure all withdrawal requests are processed swiftly and appropriately," Theocharides added.</p><p class="MsoNormal">FTX EU, formerly known as K-DNA Financial Services LTD, is a European branch of Sam Bankman-Fried (SBF) US crypto exchange that <a href="https://www.financemagnates.com/cryptocurrency/ftx-the-rise-the-fall-and-the-reaction/" target="_blank" rel="follow">collapsed a few months ago</a>, in November 2022. When the US branch collapsed, funds belonging to European customers were frozen to ensure that future claims could be covered and deposits paid out.</p><p class="MsoNormal">Finance Magnates <a href="https://www.financemagnates.com/cryptocurrency/ftx-eu-creates-new-website-for-customer-balance-withdrawal/" target="_blank" rel="follow">exclusively reported last week</a> that FTX EU had launched a website that would allow FTX EU customers to apply for the withdrawal of funds owed to them.</p><blockquote class="twitter-tweet"><p lang="en" dir="ltr">FTX EU, a solvent entity, is now paying out its customers on <a href="https://t.co/MEw8Oz8vTk">https://t.co/MEw8Oz8vTk</a>.Note: Almost none of FTX's EU citizens are FTX EU users, because for some reason, FTX EU only onboarded customers registered from March 2022. <a href="https://t.co/gu56Vysvlc">pic.twitter.com/gu56Vysvlc</a></p>— FTX 2.0pium (FTX Creditor) (@AFTXcreditor) <a href="https://twitter.com/AFTXcreditor/status/1641481931614289920?ref_src=twsrc%5Etfw">March 30, 2023</a></blockquote><p class="MsoNormal">The company confirmed the news a day later in an official press note.</p><blockquote class="twitter-tweet"><p lang="en" dir="ltr">FTX EU LTD (Cyprus) (formerly K-DNA Financial Services LTD) is commencing a process for its customers to request final balances on a dedicated website. Read details here: <a href="https://t.co/qamNICqGY4">https://t.co/qamNICqGY4</a></p>— FTX (@FTX_Official) <a href="https://twitter.com/FTX_Official/status/1641862541465755648?ref_src=twsrc%5Etfw">March 31, 2023</a></blockquote><p class="MsoNormal">The information published by FTX EU reveals that the company will provide customers with a statement of fiat currency balances in accordance with MiFID II regulations. Following this process, customers of FTX EU, subject to sufficient funds, will be entitled to withdraw their fiat currency balance as segregated in designated accounts.</p><p class="MsoNormal">"The balances will be communicated and verified, and subsequently withdrawal requests may be submitted through the following website established for this purpose: ftxeurope.eu. Any withdrawal requests will be subject to customary know-your-customer and anti-money-laundering checks, and a customer's withdrawal may be delayed if bank or other account details have not been sufficiently verified," FTX EU commented.</p><p class="MsoNormal">This announcement pertains only to customers of FTX EU LTD who opened accounts through FTX.com/eu (i.e., after 7 March 2022) and does not affect customers of other FTX group businesses, even if located in Europe.</p><p class="MsoNormal">Before the shutdown of FTX.com international platform, FTX EU operated as a MiFID II-regulated investment firm offering trading in multi-asset derivatives, particularly with crypto assets as the underlying. CySEC has suspended its license and ordered FTX EU LTD to return funds to its customers who request withdrawals. Finance Magnates' check on CySEC's public register shows that the permit is still under suspension.</p><p>FTX Japan Back on Track</p><p class="MsoNormal">Regulators worldwide froze FTX affiliates' funds after the collapse of the US exchange to protect them from uncontrolled outflows. FTX's Japanese office <a href="https://www.financemagnates.com/cryptocurrency/ftx-japan-resumes-withdrawals-in-fiat-and-crypto/" target="_blank" rel="follow">resumed withdrawing client funds</a> in late February through its Liquid Japan platform.</p><p class="MsoNormal">"In order to proceed with withdrawals, customers who have assets in their FTX Japan account would need to confirm the balance of their assets and transfer them to their Liquid Japan account," the exchange's official press release added.</p><p class="MsoNormal">Users <a href="https://www.financemagnates.com/cryptocurrency/ftx-japan-users-withdrew-50-million-in-a-day/" target="_blank" rel="follow">withdrew $50 million</a> from the $138 million in the branch's accounts in just one day. Information about the transfer of $157 million in frozen FTX-linked assets <a href="https://www.financemagnates.com/cryptocurrency/okx-to-transfer-157-million-in-frozen-assets-linked-to-ftx-and-alameda-research/" target="_blank" rel="follow">was also reported</a> last week by cryptocurrency <a href="https://www.financemagnates.com/terms/e/exchange/" class="terms__secondary-term" id="b5da6e64-2afe-421d-9b81-16404b7d59d6">exchange</a> OKX.</p><p class="MsoNormal">Recently, Finance Magnates informed that FTX debtors <a href="https://www.financemagnates.com/cryptocurrency/ftx-debtors-agree-to-95m-sale-of-mysten-labs-stake/" target="_blank" rel="follow">agreed to sell Mysten Labs Inc. </a>preferred shares back to the Web3 startup for $96 million, according to the fillings at the US Bankruptcy Court in Delaware.GMO heralds new investment and Komainu enhances custody. <a href="https://www.financemagnates.com/forex/news-nuggets-3-april-gmos-new-investment-komainu-enhances-custody/" target="_blank" rel="follow">Check today's news nuggets</a>!</p> This article was written by Damian Chmiel at www.financemagnates.com.

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FTX EU Launches Website for Customer Withdrawal Requests

FTX EU has launched a website for European customers to submit withdrawal requests following the global trading platform's collapse and bankruptcy in November 2022. The Cyprus Securities and Exchange Commission reportedly approved the new website domain name, which will only be used to pay back impacted customers and will not offer any products or services. (Read More)

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FTX EU Launches New Website for Withdrawals as Subsidiary Starts Returning Funds to Customers

FTX’s European subsidiary, FTX Europe, has launched a new website, ftxeurope.eu, for users to withdraw funds from the now-defunct cryptocurrency platform. Withdrawal requests must be submitted through the new website and will be “subject to customary know-your-customer and anti-money-laundering checks.” FTX’s European Arm Opens Withdrawals to Customers According to a press release published on Friday, [...]

The post FTX EU Launches New Website for Withdrawals as Subsidiary Starts Returning Funds to Customers appeared first on Crypto Breaking News.

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