Corporate Watchdog of Australia suspends FTX's Financial Services License.

Kutl Ahmedia

The Australian Securities and Investment Commission (ASIC), Australia's corporate watchdog, has put the local branch of the defunct cryptocurrency exchange FTX's financial services license on hold. According to a statement made by ASIC, FTX Australia may continue to provide "limited financial services that relate to the termination of existing derivatives with clients" until December 19. After FTX Trading, the company's parent company, and a few other affiliated companies filed for Chapter 11 bankruptcy in the US on November 11, the company was put into voluntary administration.

The ASIC noted in its statement that prior to the suspension, "FTX Australia's licence permitted it to deal in, make a market for, and provide general advice relating to derivatives and foreign exchange contracts to retail and wholesale clients."

The corporate regulator stated that "ASIC is closely monitoring this situation and regularly communicating with international regulators and the external administrators." Clients of FTX Australia are urged by ASIC to closely monitor the situation and keep an eye out for updates from the FTX Group and FTX Australia's administrators on the KordaMentha website.

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Global cryptocurrency exchanges, including those in Australia, have been impacted by FTX's downfall. For instance, Brisbane-based exchange Digital Surge announced on November 16 that withdrawals have been suspended, citing fallout from FTX's demise. Digital Surge posted a message on its website explaining that it was unable to conduct business as usual due to the effects of FTX Australia's administration and that all deposits and withdrawals had been suspended.

The action was taken as traders rushed to withdraw their money in large numbers in response to FTX's $8 billion (roughly Rs. 64,945 crore) balance sheet shortfall, which caused Sam Bankman-Fried's crypto empire to collapse last week.

FTX and Alameda Research FTX launched FTX Australia in Sydney in March 2022. Kraken Freezes Accounts Related to FTX. Then-CEO Sam Bankman-Fried stated at the time, "We're pleased to deliver FTX's innovative goods and services to the Australian marketplace." "FTX Australia's establishment should give all of our local clients the assurance that they are trading on a registered and authorized platform."

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