Regulator cancels license of FTX’s Australian business By Reuters

Regulator cancels license of FTX’s Australian business By Reuters

© Reuters. FILE PHOTO: Representations of cryptocurrencies are seen in front of displayed words “Cryptocurrency market” in this illustration taken November 10, 2022. REUTERS/Dado Ruvic/Illustration/

(Reuters) -Australia’s securities regulator said on Wednesday it had cancelled the license of the local arm of collapsed U.S. cryptocurrency exchange FTX, effective from July 14.

Bahamas-headquartered FTX, once a star of the crypto industry with a $32 billion valuation in January 2023, filed for U.S. bankruptcy protection last November, saying it was unable to completely repay customers who had deposited funds on its exchange.

The industry has since been reeling amid the scrutiny of global regulators, while FTX founder Sam Bankman-Fried faces a criminal lawsuit by the U.S. government for alleged fraud. He denies the allegations and has pleaded not guilty.

The Australian Securities & Investments Commission (ASIC) had last November suspended the license until May, taking back FTX’s permit to deal in derivative and foreign exchange contracts to retail and wholesale clients.

FTX Australia can continue to provide limited financial services for terminating existing derivatives with clients until July 12, 2024, the regulator said on Wednesday.

The license cancellation has no effect on requirements for FTX Australia to continue as a member of Australian Financial Complaints Authority, and to have arrangements for compensating retail clients, it added.

FTX did not immediately respond to a Reuters request for comment.

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