Japan’s Financial Services Agency requested the exchange suspend business orders on Nov. 10 prior to FTX Group declaring bankruptcy in the United States.
Crypto exchange FTX’s subsidiary in Japan, FTX Japan, reportedly plans to resume withdrawals by the end of 2022.
According to a Nov. 21 report from Japan-based news outlet NHK, FTX Japan has been making preparations to resume withdrawals. Japan’s Financial Services Agency, or FSA, requested the exchange suspend business orders on Nov. 10 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.
On Nov. 11, the FSA announced that it had taken administrative actions against FTX Japan amid reports its parent company was “facing credit uncertainties.” The orders required FTX Japan to suspend over-the-counter derivatives transactions and related margins as well as new deposits from users from Nov. 10 to Dec. 9 unless directed otherwise by the financial regulator. FTX Japan should have also submitted a plan by Nov. 16 on how the exchange intended to protect investors and provide transparency on the ongoing situation.
Citing an unnamed executive at the Japanese exchange, NHK reported that FTX Japan had roughly 19.6 billion yen in cash — more than $138 million — as of Nov. 10 when it ceased operations. The Japan-based company was also reportedly for sale amid FTX Trading’s bankruptcy proceedings in the United States.
Other FTX subsidiaries have taken similar actions in response to ongoing litigation against the company. Liquid, one of FTX Group’s companies also based in Japan, announced on Nov. 20 that it had paused “all forms of trading” due to the firm filing for bankruptcy under Chapter 11. LedgerX, owned by FTX US under the firm West Realm Shire Services, may be exempt as a debtor in FTX’s bankruptcy filing.