FTX Granted Three Additional Months to Cease Japanese Operations
FTX Japan, the Japanese subsidiary of the now shuttered FTX ecosystem, has obtained approval from The Kanto Local Finance Bureau (a local financial regulator running under the authority of the Japanese Ministry of Finance) to continue with the sorting out of various issues concerning withdrawals for an extra three months. Initially FTX Japan was to cease operations by December 9, 2022, but this approval extends said time to March 9, 2023.
With the regulator emphasizing that the trading system of FTX Japan is 'out of function', the deadline to cease operations was extended for the purpose of returning assets from custody to the appropriate creditors. To date, FTX Japan has wholly failed to return any assets from custody to creditors.
Nonetheless, on November 16, 2022, FTX Japan submitted a 'business improvement plan' to the Kanto Local Finance Bureau. According to a blog post by FTX Japan, they are proceeding with the 'improvement plan' as submitted, however, as the company's operations are out of function, it is simply not possible to quickly return assets to the proper customers.
And on December 1, 2022, FTX Japan issued its roadmap for the resumption of withdrawals. Prior to this announcement, FTX Japan received information that Japanese customer cash and cryptocurrency were not a part of the FTX Japan bankruptcy estate. This determination came as a result of how FTX Japan was holding the assets as well as the nature of property interests pursuant to Japanese Law.
As of the date FTX Japan was to suspend operations by order, November 10, 2022, it reportedly held Y19.6 Billion (yen, or $138 Million in cash and deposits. Initially, FTX Japan was planning to resume withdrawals before the end of year 2022.
INFORMATIONAL SOURCES
FTX JP. Apology and notice regarding administrative disposition. (Accessed December 9, 2022)
Datta, S. FTX Japan to unfreeze withdrawals of client funds. (Accessed December 9, 2022)
Partz, H. FTX reportedly gets 3 more months to stop all operations in Japan. (Accessed December 9, 2022).
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Very informative and the references were also educational.
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