CySEC extends FTX Europe’s suspension until May 2025, halting trading and new business while the company regains compliance.
In a significant development, the Cyprus Securities and Exchange Commission (CySEC) announced extending FTX Europe’s suspension for another six months. This marks the fourth extension since the original suspension in November 2022, shortly after FTX’s collapse in the U.S.
The latest suspension, which runs until May 30, 2025, prevents FTX Europe from providing investment services, conducting new business, or accepting new clients. The firm is also banned from labelling itself as an investment service provider. However, CySEC said FTX Europe can carry out existing transactions and return funds and financial instruments to its clients.
CySEC decides to give FTX Europe more time to comply with the laws governing investment services and regulated markets. The regulator said the firm must address regulatory concerns before it can resume operations.
FTX Europe Trading Suspended Amid Regulatory Scrutiny
Trading options on FTX Europe’s website have been suspended after the suspension. Instead, users can only log in to check their account balances or request withdrawals. This comes as the company’s future remains uncertain.
Digital Assets AG was initially a Swiss company called FTX Europe. Last year, FTX bought the startup for $323 million and rebranded it to FTX Europe. However, after FTX’s bankruptcy, the management was questioned, and CySEC suspended its operations—the suspension aimed to protect client assets after FTX’s financial problems.
Conversely, FTX’s restructuring included selling off assets like FTX Europe. The restructuring team said the $323 million purchase was a massive overpayment’ for the acquisition, given that the company had paid a high price to acquire it in the first place. Eventually, the firm sold FTX Europe back to its founders for a pittance: $32.7 million, less than 1% of the price it had paid originally.
FTX Europe’s future is unclear given the latest suspension, but CySEC will remain vigilant. The extension ensures that the company remains under regulatory scrutiny until it can resolve its issues and regain compliance with the law.
