FTX Japan Is Preparing to Enable Customer Withdrawals

Trisha Kae Andrada, Tech Times 02 December 2022, 10:12 am

FTX Japan, the Japanese affiliate of the recently defunct cryptocurrency empire, has announced that it is trying to enable customers in the country to withdraw their assets.

It looks like there is hope for investors who lost their money on the crypto exchange.

FTX Update

According to a report by Bloomberg News, a website update posted on Thursday, Dec. 1, indicated that the new management team at FTX Trading had authorized a proposal to restore withdrawal services.

Notably, the said function had been temporarily halted since Nov. 8.

The firm is implementing controls, a security audit, bank reconciliation, and assessments as part of the strategy.

On Nov. 11, the complex network of firms owned by Sam Bankman-Fried, known as the FTX group, plunged into a catastrophic bankruptcy. It defrauded over a million creditors throughout the globe and caused widespread disruption in the cryptocurrency market.

Plans in Japan

Reports indicate that the Japanese financial regulator has been trying to get a plan together and a deadline for the repatriation of client funds.

After a verification procedure, customers of FTX Japan will be able to move their balances to Liquid, a platform it purchased last year to strengthen its local presence, and withdraw their funds.

FTX Japan K.K. has designated customer accounts holding about $94.5 million in crypto assets and $46 million in fiat cash by now.

The Filings

After consulting with the legal firm representing the FTX group in the Chapter 11 bankruptcy proceedings, FTX Japan has determined that the cash and crypto held by its Japanese customers will not be included in the estate of FTX Japan.

On this basis, the local unit intends to start withdrawal service as usual, based on the statement.

It was said in the statement that FTX Japan's management is in constant contact with the country's authorities.

It has already presented the plan's first draft and will continue to communicate with them as they reach major goals.

Reportedly, the Japan operations team also had exclusive access to the private keys to the asset-segregated wallets, and these keys were always stored offline.

Recent Claims

As reported by Tech Times, FTX former CEO Sam Bankman-Fried told CNBC he did not commit fraud on anybody and was startled by what transpired since his crypto exchange was "thriving."

Bankman-Fried said, "I've had a bad month."

CNBC's Andrew Ross Sorkin questioned the CEO's investments considering Alameda's financing from target companies.

Bankman-Fried predicted Alameda would repay all loans by 2022. However, Alameda owes BlockFi $670 million, court papers show.

FTX's demise raises questions about whether Alameda misused the money. For the record, Alameda struggled to pay creditors as crypto's value fell.

Alameda's lack of assets led to the meltdown when FTX users initiated a crypto exchange bank run by utilizing customer cash to pay off lenders, according to Tech Crunch.

When Sorkin inquired whether Alameda and FTX money were mixed, Bankman-Fried denied the accusation.

The billionaire stated he did not appoint someone to handle the Alameda-FTX alliance. The $32 billion firm has no board of directors.

He stated he should have paid closer attention to the financial entwining but feared being at risk owing to his conflicting ownership positions in the two enterprises.