Regulators in Australia questioned the business practices of bankrupt cryptocurrency exchange FTX just weeks after it went live in the country and six months before its eventual collapse.
According to another Report by WatchmanThe Australian Securities and Investments Commission (ASIC) issued three notices to FTX between April and October 2022.
Australian regulators issued notice s912C to the cryptocurrency exchange in April 2022. Accordingly, ASIC requested that FTX Australia disclose details guiding its business operations to determine whether FTX is suitable to obtain an Australian Financial Services License (AFSL). The notice popped up as ASIC questioned the operations that had certified FTX to operate in the country.
Similarly, the report also confirmed that the price of crypto assets on FTX is worrying regulators in the country. The cryptocurrency exchange has reportedly offered customers margin loans of up to 20 times their investment, which is provided by the relevant authorities.
Other issues that prompted ASIC to monitor FTX activities include user inclusion and the company’s compliance with its product intervention order.
Remember that in December 2021, FTX acquired AFSL before commencing operations in March 2022.
Highlights of the FTX breakdown
In the wake of FTX breakdownits Australian subsidiary ceased to withdraw on November 11th. After the collapse, the ASIC Withdrawal of FTX’s operating licenselaunching an investigation into the cryptocurrency exchange looking for “suspected breaches of corporate legislation”.
The collapse of FTX fueled the harshness of the crypto winter on projects and investors in the industry. The impact of the demise of FTX more than 130 companies, including FTX Australia. to me decompositionabout $9 billion in the crossfire with FTX as creditors push to reclaim their assets via legal deposits.
In a positive development, reports Shown That Japanese users of FTX are likely to get their money’s worth early this year. in blog Mail On December 29, the Japan subsidiary of FTX revealed a roadmap that will help users recover their assets through direct withdrawals from Liquid, a sister trading platform owned by FTX.