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The Australian arm of FTX has seen its license canceled by the Australian Securities and Investments Commission (ASIC). It can still work on compensating victims, which number roughly 30,000.
The Australian Securities and Investments Commission (ASIC) has canceled the license of FTX Australia, as revealed in a press release published on July 19. With the Australian Financial Services (AFS) license revoked, the Australian unit of FTX will be unable to operate as an exchange.
ASIC Cancels FTX Australia License
The cancellation was effective from July 14, 2023. Until July 12, 2024, FTX Australia may still provide limited financial services “that relate to the termination of existing derivatives with clients.”
The exchange may still work towards compensating its customers, which number around 30,000 in Australia. It also provided services to 132 local companies.
Australia has been taking a much stricter stance towards crypto exchanges following the bankruptcy of FTX. On July 17, it also banned major Australian banks from making payments to Binance. The Australian offices of Binance have also been searched as part of an ongoing probe.
The probe is part of a larger effort by Australia to regulate the crypto industry. The Binance probe has to do with the exchange’s derivatives offerings, primarily focusing on the classification of clients.
However, according to one report, crypto is popular in Australia, leading the world in this regard.
ASIC Taking Strict Stance on Crypto Exchanges
ASIC previously suspended the license of FTX Australia until May 2023, which was later extended until July 24, 2023. The recent revocation is a more definitive indictment of the exchange.
The FTX meltdown is among the several reasons prompting Australian regulators to tighten scrutiny on crypto companies. Check out our guide on the collapse to the exchange to learn more: FTX Collapse Explained: How Sam Bankman-Fried’s Empire Fell
The fallout of the FTX collapse had led Australia’s parliamentary committee to recommend closer scrutiny of financial licenses. It also calls for an audit of current license holders. ASIC is working on obtaining more staff to handle these new priorities, like other agencies across the world.
Meanwhile, there have been multiple developments besides FTX Australia having its license canceled.
One major revelation is the allegation by FTX creditors that BlockFi CEO Zac Prince was aware of FTX’s troubled balance sheet before the collapse.
FTX’s former Chief Operating Officer, Zhe Wang, has also made a move away from the exchange. She now works at the crypto venture capital firm Sino Global Capital.
Arkham Intelligence’s Intel Exchange now has a bounty of 100,000 Arkham (ARKM) tokens for anyone who can discover the identity of whoever siphoned hundreds of millions from FTX in November 2022.