The Cyprus Securities and Exchange Commission (CySEC) has prolonged the suspension of FTX.com’s Cyprus Investment Firm (CIF) license until May 30, 2025. This extension prevents the insolvent crypto exchange, FTX Europe, from conducting business throughout Europe while it remains under regulatory review.
According to CySEC’s latest regulatory directive, FTX Europe is prohibited from providing any investment services, onboarding new clients, or entering new business relationships while the suspension is in force. Specifically, FTX Europe cannot execute client orders for purchasing financial instruments, either within Cyprus or internationally, nor can it advertise itself as an investment services provider.
The suspended brand must close any open positions linked to clients’ contracts upon reaching maturity or upon client request, while also ensuring that clients receive all remaining funds and profits in their accounts.
In 2022, CySEC initially ordered FTX Europe to halt operations and carry out actions aimed at protecting investors. The exchange was given one month to address suspected regulatory breaches, specifically around safeguarding client assets and ensuring the suitability of its management. This led to further investigations, resulting in an ongoing suspension of its operating license.
FTX Europe was one of the entities affected by the broader FTX Group’s collapse, which led to bankruptcy filings after the company, previously led by Sam Bankman-Fried, experienced a rapid downfall. Since December 2022, CySEC has extended FTX Europe’s license suspension multiple times, the most recent now pushing the suspension deadline into 2025.
FTX Europe’s authorization, originally granted by CySEC in September 2022, allowed it to provide cryptocurrency services throughout the European Economic Area. However, the company’s operations remain in limbo as part of a larger bankruptcy proceeding. In the United States, a bankruptcy court recently allowed FTX liquidators to initiate the sale of four subsidiaries, including FTX Europe and FTX Japan. These entities have reportedly drawn interest from up to 117 potential buyers.
The committee representing FTX’s creditors is keen to expedite these sales, arguing that each of these subsidiaries maintains a solvent balance sheet, independent management, and valuable franchises that risk depreciation if left unsold for too long.
Meanwhile, FTX Europe recently announced a process for customers to verify final balances and request withdrawals of their fiat funds. A dedicated website, ftxeurope.eu, has been set up to facilitate this process, allowing customers to retrieve funds from the company’s segregated accounts.
As CySEC continues to scrutinize FTX Europe’s compliance with local regulations, the firm’s future remains uncertain. With ongoing bankruptcy proceedings and the potential sale of its subsidiaries, FTX Europe is in a holding pattern as stakeholders work to recover client assets and resolve regulatory concerns.
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