Cyprus Prolongs Suspension of FTX’s European Division for an Additional Six Months

The Cyprus Securities and Exchange Commission (CySEC) has prolonged its suspension of FTX’s European branch, FTX Europe, for an additional six months.

This decision, revealed on November 5, postpones the company’s capacity to operate until at least May 30, 2025.

The extension forbids FTX EU from providing services, marketing, or onboarding new clients, although it permits the platform to finalize transactions and return funds to current clients.

CySEC Suspends FTX Europe’s Operations for the Fourth Time

This represents the fourth extension of the suspension since CySEC initially halted FTX Europe’s operations in November 2022, following FTX’s bankruptcy in the United States.

At that point, FTX had been active in the European market for merely eight months, delivering regulated investment services for multi-asset derivatives.

CySEC’s original suspension referenced concerns regarding FTX Europe’s management and underscored the necessity to safeguard client assets amid the company’s financial turmoil in the U.S.

FTX Europe, formerly known as Digital Assets AG, was purchased by FTX in 2021 for $323 million.

The acquisition subsequently attracted scrutiny from FTX’s restructuring team, who asserted that the purchase price was considerably inflated.

Legal disputes surrounding the acquisition concluded in February 2024, when FTX reached an agreement with the original owners to reacquire FTX Europe for $32.7 million.

CySEC 再次延长 FTX（EU）牌照暂停期限https://t.co/yANEqa8IjB#CySEC #FTX #牌照 #新闻 pic.twitter.com/VUsDSYFkdl

— FX110 全球华人外汇信息平台 (@FX110_com) November 6, 2024

At present, the FTX Europe website no longer provides trading services.

Instead, it offers users a portal to check balances and request withdrawals.

CySEC regulations dictate that funds remaining in user accounts will be maintained in a “client segregated account” for six years if not withdrawn.

Meanwhile, in the U.S., the Justice Department is pursuing the recovery of up to $13.25 million in political contributions associated with former FTX executives, as disclosed in a recent federal court filing.

Judge Lewis Kaplan, who is overseeing the criminal case against former FTX CEO Sam Bankman-Fried and his associates, granted the government’s request for an extension until January 15 to negotiate with various political action committees (PACs).

SBF’s Neurodivergence Disorders Affected Trial

Last month, a group of medical professionals submitted an amicus brief in support of Sam Bankman-Fried’s appeal, asserting that his criminal trial may have been significantly influenced by his neurodivergence disorders.

The FTX co-founder, diagnosed with autism spectrum disorder (ASD) and attention-deficit/hyperactivity disorder (ADHD), encountered “serious challenges” during the court proceedings, according to the doctors.

The brief, endorsed by eight specialists in neurodivergence, pointed out that several decisions made during the trial were harmful to Bankman-Fried due to his conditions.

The amicus brief also coincided with another submission by a group of bankruptcy law professors who raised concerns about the relationship between FTX’s bankruptcy case and Bankman-Fried’s criminal trial.

While they did not advocate for either side, the professors contended that the collaboration between the FTX bankruptcy estate and the prosecution could establish a “dangerous precedent,” promoting the use of Chapter 11 proceedings to support concurrent criminal prosecutions.

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