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    Australian authorities suspended FTX Australia's license to recompense 30,000 investors

    Tanya Sharma
    Nov 16, 2022 12:40
    Nearly eight months after it was founded on March 20 in the biggest country in Oceania, FTX Australia has suspended its customer-facing operations.
    Australian authorities suspended FTX Australia's license to recompense 30,000 investors
    Source: Yahoo.com

    The suspension of FTX Australia

    March 2022 saw the Sydney debut of FTX Australia. At the time, FTX's former CEO Sam Bankman-Fried stated, 

    "We're pleased to introduce FTX's unique goods and services to the Australian marketplace,all of our local clients should feel secure trading on a regulated and authorized platform thanks to the launch of FTX Australia.”

    The local FTX affiliate was previously placed under voluntary administration by the agency on November 11, 2022, the same day that FTX sought Chapter 11 bankruptcy protection.

    FTX Australia's financial services license has been suspended by the Australian Securities & Investments Commission (ASIC) until May 15, 2023,

    The suspension of FTX Australia is the most recent domino to fall in the tragic demise of Sam Bankman-once-dominant Fried's empire.

    This was followed by the selection of a volunteer administrator to aid in the recovery of monies from FTX for close to 30,000 Australians and 132 Australian businesses.

    KordaMentha to recover the funds of 30,000 investors 

    The suspension comes after KordaMentha, an investment and advisory firm with offices in Sydney, engaged John Mouawad, Scott Langdon, and Rahul Goyal as voluntary administrators to provide restructuring services to FTX Australia and its subsidiary FTX Express on November 11.

    According to a Nov. 14 article in the Australian Financial Review, KordaMentha will try to recover the funds of roughly 30,000 Australian investors and 132 Australian businesses as a result of the disastrous FTX aftermath (AFR).

    “The regulator advised FTX Australia's clients to closely watch the situation and keep an eye out for updates from the FTX Group and FTX Australia's administrators on the KordaMentha website.”

    FTX Australia staff members have been working with KordaMentha's administrators to find a solution. One of the three directors of FTX Australia is listed as Sam Bankman-Fried, the founder and former CEO of FTX.

    FTX restricted to  a small number of financial services 

    Before it was revoked, FTX Australia's AFS license allowed it to establish a market for derivatives and foreign exchange contracts for retail and wholesale customers in Australia. 

    FTX Australia served as the conduit for Australian traders who registered to trade digital assets.

    Related:  Visa and FTX part ways, bringing the debit card partnership to an end

    However, until December 19, FTX Australia is only allowed to offer a small number of financial services that are primarily related to terminating already-existing derivative contracts with its clients.