On November 10, prior to FTX Group declaring bankruptcy in the United States, Japan’s Financial Services Agency requested that the exchange suspend business orders.
FTX Japan, the Japanese subsidiary of cryptocurrency exchange FTX, is reportedly planning to resume withdrawals by the end of 2022.
According to a Nov. 21 report by the Japanese news outlet NHK, FTX Japan has been preparing to resume withdrawals. Prior to FTX Group declaring bankruptcy in the United States for more than 130 associated companies, including FTX Japan Holdings, FTX Japan, and FTX Japan Services, Japan’s Financial Services Agency, or FSA, requested the exchange suspend business orders on November 10.
The FSA announced administrative actions against FTX Japan on November 11 in response to reports that its parent company was “facing credit uncertainties.” The orders required FTX Japan to suspend over-the-counter derivatives transactions and associated margins, as well as new user deposits, from November 10 to December 9, unless otherwise directed by the financial regulator. By November 16, FTX Japan should have also submitted a plan outlining how the exchange intended to protect investors and provide transparency on the current situation.
According to NHK, FTX Japan had approximately 19.6 billion yen in cash — more than $138 million — as of Nov. 10, when it ceased operations, citing an unnamed executive at the Japanese exchange. The Japanese firm was also rumored to be for sale during FTX Trading’s bankruptcy proceedings in the United States.
Other FTX subsidiaries have taken similar actions in response to the company’s ongoing litigation. Liquid, another FTX Group company based in Japan, announced on Nov. 20 that it had halted “all forms of trading” due to the firm filing for Chapter 11 bankruptcy. LedgerX, which is owned by FTX US through the firm West Realm Shire Services, may be exempt from FTX’s bankruptcy filing as a debtor.
