FTX Japan Granted Extra Time by Regulators
The beleaguered FTX Japan, a subsidiary of the infamous FTX cryptocurrency exchange, has managed to secure an extension from local financial authorities, allowing it to continue sorting out its withdrawal issues until March 9, 2023. The Kanto Local Finance Bureau, which operates under Japan’s Ministry of Finance, has confirmed this development, effectively pressing the snooze button on the exchange’s business suspension deadline.
The Clock is Ticking: Background of the Situation
Initially, the Japanese Financial Services Agency (FSA) ordered FTX Japan to cease its business operations by December 9, 2022. This came on the heels of FTX’s spectacular collapse and subsequent bankruptcy proceedings that put a dark cloud over the cryptocurrency environment. However, it appears the local regulators are granting some leeway in hopes that FTX Japan can finally clear up its withdrawal backlog with a bit more time and effort.
Why the Extension?
What prompted the Kanto Local Finance Bureau to lift its figurative foot off the gas? Well, the agency highlighted that FTX Japan had not adequately returned assets held in custody to its creditors. In plain terms, the trading system was still out of commission, and without functioning systems, it’s like trying to squeeze juice from a rock—impossible!
FTX Japan’s “Business Improvement Plan”
In a blog post, FTX Japan acknowledged the situation and mentioned that it is actively working on a “business improvement plan.” This plan was submitted to the local finance bureau back in mid-November. Their statement made it abundantly clear that while they’re trying to make things right, it’s not exactly a speedy process: “It’s not possible to quickly return customer’s assets.”
What’s Next for Customers?
For customers nervously clutching their crypto assets, this extended withdrawal timeline might bring a glimmer of hope. Just recently, on December 1, FTX Japan had also released a roadmap aimed at aiding the resumption of withdrawals. The company reassured users that their assets were not entangled in FTX’s broader bankruptcy saga, lighting a small candle of optimism amid the chaos. However, their plans to resume withdrawals by the year’s end remain locked in a suspenseful cliffhanger.
Historical Context: FTX’s Expansion in Japan
To put things into perspective, FTX launched its Japanese operations in June 2022, shortly after it acquired the local exchange Liquid. While their entry seemed promising, the subsequent downfall of the parent company has led to a whirlwind of uncertainty for FTX Japan’s customers. Will they ever see their funds again? Only time will tell, but for now, the regulators seem willing to give them a fighting chance, even if it’s a bit late to the party.
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