Based on an announcement launched on July 19, the Australian Securities and Investments Fee (ASIC) revoked the Australian Monetary Providers (AFS) license held by FTX, a subsidiary working in Australia, on July 14.
The cancellation of the license is not going to have an effect on FTX Australia’s compensation preparations for its retail purchasers and the continuation of its Australian Monetary Complaints Authority membership. The Alternate might also present restricted monetary companies for liquidation of present derivatives with purchasers earlier than July 12, 2024.
FTX Australia serves over 30,000 clients
Earlier than its license was revoked, FTX Australia served roughly 30,000 clients, making it one of many largest crypto platforms within the nation.
Eight months earlier than its collapse, in March 2022, ASIC had already began elevating issues in regards to the operations of FTX Australia. On the time, the regulator had positioned the alternate underneath “monitored exercise” on the premise of issues that it had bypassed scrutiny of issuing new licenses.
The regulator will later droop the AFS license of the alternate when it enters voluntary administration in November.
In the meantime, two entities are reportedly associated to the bankrupt alternate in Australia, together with FTX Australia. The 2 firms maintain roughly $42 million in shopper funds.
Australia’s Rising Crypto Regulation Efforts
The cancellation of FTX Australia’s license is a part of a wider effort by the Australian authorities to more and more regulate the crypto business.
In April, ASIC carried out a compliance overview of Binance’s monetary companies enterprise underneath native legal guidelines and reportedly searched the platform’s workplace earlier this month. Citing non-compliance with native legal guidelines, Binance abruptly revoked its derivatives license with the regulator.
In the meantime, a number of Australian banks together with Westpac, Nationwide Australian Financial institution (NAB) and others have lately been limiting funds to crypto exchanges as a part of efforts to scale back their clients’ threat of scams.
Banks have named cryptocurrency scams as one of many quickest rising safety threats within the nation.
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