The Australian Securities and Investments Commission (ASIC) has canceled the AFS license of bankrupt crypto exchange FTX’s Australian entity.
The cancellation, effective from July 14, comes after FTX slipped into bankruptcy last November. FTX Australia will be able to provide limited financial services until July 12, 2024, while winding up client interactions. ASIC has asked the company to work towards compensating its clients during this period.
- FTX Australia had 30,000 retail clients and serviced 132 domestic companies.
- FTX Australia held the AFS license to offer derivative products, while FTX Express allowed customers to exchange fiat for cryptocurrency and vice versa.
- ASIC initially suspended FTX’s license in May but later reinstated it to assist in unwinding trading positions and determining the origin of customer funds.
- The cancellation has no effect on FTX Australia’s membership in the Australian Financial Complaints Authority and its arrangements for compensating retail clients.
- The cancellation is part of an overall crackdown on the crypto industry in Australia, with measures such as Westpac banning payments to Binance and APRA instructing banks to declare their exposure to crypto-related ventures.
Hot Take: The cancellation of FTX’s license in Australia highlights the increasing regulatory scrutiny and crackdown on the crypto industry. It also emphasizes the importance of investor protection and compensation in the event of bankruptcies or financial difficulties.
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