FTX Japan Gets Three Months Deadline to Sort Customer Withdrawals

• Japan authorities gave FTX Japan approval to work for three months more.
• FTX Japan’s previous business suspension order will take effect from March 2023.
• The Japanese subsidiary is one of 134 companies caught up in FTX’s bankruptcy.

Local regulators have given the Japanese affiliate of the bankrupt FTX crypto exchange permission to work through withdrawal-related problems until 2023. According to Reuters, the Kanto Local Finance Bureau has agreed to extend the business suspension order to FTX Japan until March next year.

FTX’s administrative disposition was initially supposed to end on December 9, 2022. However, the authorities gave additional three months’ extension due to the inability of customers to withdraw their crypto assets in FTX’s custody.

Notably, FTX Japan came to life barely seven months ago as FTX acquired the Japanese crypto exchange Liquid. Furthermore, the Japanese subsidiary is one of 134 companies caught up in FTX’s bankruptcy proceedings but has been drafting a plan to return client funds.

In an official note early this month, FTX Japan confirmed that its customers’ assets would not be part of FTX Japan’s estate due to Japanese regulations, which mandate that crypto exchanges must separate client funds from their assets.

In related news, FTX went bankrupt last month with nearly 500 illiquid investments split across ten holding companies with a total of over $5.4 billion. Today, a CNBC crypto trader, Ran Neuner, called on Changpeng Zhao of Binance and Ben Zhou of Bybit for collaborations towards making FTX customers whole again.

Neuner proposed a new FTT token issuance where 100% of the profits would accrue to FTX’s creditors and depositors.

Interestingly, the former CEO of FTX, Sam Bankman-Fried, supported Neuner’s motion, saying it would be a productive path for parties to explore and that he hopes the teams in place would do so.