The Japan Financial Services Agency (FSA) has ordered the Japanese subsidiary of the FTX exchange to suspend all over-the-counter derivatives transactions in order to protect the interests of investors and creditors.
The FSA said it took action against FTX Japan after the parent company halted withdrawals without a clear explanation to investors. The regulator banned the exchange from conducting over-the-counter transactions with derivatives, as well as opening new user deposits.
“There have been reports that FTX Trading Limited is facing credit uncertainty. Everything possible must be done 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 in the country during the same period, reflecting 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.
Earlier, the founder of the Tron project, Justin Sun, said that the FTX liquidity crisis, despite its short-term nature, is detrimental to both the development of the industry and investors.
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