The Australian Securities and Investments Commission (ASIC) has suspended FTX Australia’s financial license after the appointment of a voluntary administrator to help about 30,000 consumers and 132 companies get their funds back from the collapsed crypto exchange.
John Mouawad, Rahul Goyal, and Scott Langdon of KordaMentha, a Sydney-based investment and advisory firm, have been appointed as voluntary administrators to help provide restructuring services to FTX Australia and its subsidiary FTX Express on November 11.
The regulator also suspended the Australian Financial Services (AFS) license of Sam Bankman-Fried FTX’s local entity until May 15, 2023. The license had allowed FTX to create a market for derivatives and foreign exchange contracts to Australian-based retail and wholesale clients and traders who had signed up to trade digital assets were routed through FTX Australia.
The beleaguered crypto exchange is permitted to provide limited financial services that strictly relate to the termination of existing derivative contracts until December 19. KordaMentha will try to recoup the funds of nearly 30,000 Australian investors and 132 companies that have been struck due to FTX’s catastrophic fallout. The exchange’s Australian employees have been cooperating with the investment and advisory firm to resolve the matter.
It should be noted that the suspension of FTX Australia’s customer-facing operations comes just eight months after it was established on March 20. FTX had also established a Sydney-based office for its five employees.
FTX Australia can apply to the Administrative Appeals Tribunal to challenge ACIS’s decision.