The EU-based subsidiary of the FTX exchange has taken up the challenge to pay back users who lost their investments last year. The EU branch had only operated for seven months after its launch before the parent exchange collapsed.
It recently launched a website approved by the Cyprus Securities and Exchange Commission to accept customers’ withdrawal requests. This move will be a welcome development within the European crypto community.
Customers To Send Request To New Website
An FTX Creditor shared the news on Twitter, revealing the European arm plans to pay users whose money were stuck on the exchange. The post stated that the exchange is a solvent entity leading to many negative responses from other users asking for the validity of its solvency.
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The report also disclosed that the sole aim of the site is to pay back the customers who lost money when the main exchange crashed. As such, it won’t offer services beyond this or sell any product. FTX EU LTD clients will only get their FIAT balances through the website.FTX EU Launches Website for Withdrawals to Refund European Users" width="980" height="571">
For now, there are no precise details on the number of users that lost funds in the EU subsidiary. But given the short duration in which the exchange operated between launch and collapse, it’s safe to assume the user count may not be massive as compared to the US branch.
Notably, the Cryprus SEC had requested that FTX’s European arm shut down operations before the FTX filed for bankruptcy in the US. Reuters reported that the commission mandated the exchange to suspend its operations on November 9.
After the crash of the FTX exchange, CySEC suspended the license it granted FTX EU to offer crypto derivative products. The commission stated that the subsidiary failed to protect clients’ assets and allowed unsuitable members to join its Management Board, necessitating the suspension.
CySEC gave FTX EU one month to comply with the requirements. But in late December 2022, the commission extended the deadline to March 2023 to enable the firm to return clients’ funds.
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The FTX EU license is still under CySEC suspension. But it currently has two domains, www.ftx.com/eu and https://ftxeurope.eu. A quick check shows that the latter is active while the former is unresponsive.
The new website prompts users to log in, see their balance, and request a withdrawal.
FTX Saga And Its Branches Moves To Repay Customers
The crash of the exchange in November 2022 was one of the events that shook the crypto industry. Subsequent investigations revealed that its management, including its CEO and sister company’s executive, misappropriated customer’s funds leading to insolvency.
The EU branch was one amongst up to 130 companies under the umbrella of the FTX Group. It was only approved on March 22, and by November 9, it stopped operating according to Cyprus SEC’s directive.
Two days later, on November 11. The SBF-led exchange filed for bankruptcy, triggering a massive crash across the market.
Featured image from Pexels and chart from Tradingview.com