The Financial Services Agency of Japan (FSA) has demanded that the Japanese branch of the FTX exchange suspend all over-the-counter transactions with derivatives in order to protect the interests of investors and creditors.
The FSA said it took action against FTX Japan after the parent company suspended the withdrawal of funds without a clear explanation to investors. The regulator banned the exchange from conducting over-the-counter transactions with derivatives, as well as opening new deposits of users.
"There have been reports that FTX Trading Limited is facing credit uncertainty. It is necessary to do everything possible to prevent a situation in which the interests of creditors and investors will suffer from the outflow of assets to affiliated companies," the FSA said in a statement.
Operations are suspended from November 10 to December 9 — during this period, only the FSA can resume them ahead of schedule. Also, the financial regulator obliged the exchange to keep its assets inside the country during the same period, reflecting the liabilities in its balance sheet. In addition, by November 16, FTX must submit to the FSA a plan to protect investors and ensure transparency of the current state of affairs in the company.
