FTX Japan, the subsidiary of the FTX Trading Inc. brand operating in Japan has received an extension for running its operations before it shuts down.
The FTX exchange is now defunct but the FTX Japan exchange, operating under the same brand name has been given an operational extension in Japan.
FTX Japan has Three Months to Shut Down Operations
FTX Japan had submitted a request to the Kanto Local Finance Bureau to be given an extension to operate in Japan.
The regulatory authority has reportedly permitted the exchange to carry on with its operations. The regulator has allowed the exchange to operate in Japan for up to three months.
Following the approval, the exchange has a three-month period to sort out its financial issues. The exchange is also expected to reopen the withdrawals option for Japanese exchange users.
The update suggests that the exchange has until March to keep operating in Japan. The regulator expects that it is the sole responsibility of the exchange to ensure the users’ withdrawals remain open.
The users must be allowed to carry out their withdrawals until the predefined period following the approval.
The sources have confirmed that the regulatory authority has given the extension to the exchange until March 9, 2023, to operate in Japan.
The Kanto Local Finance Bureau is a financial regulatory watchdog in Japan that reports directly to the Japanese Ministry of Finance.
Initial Extension as on December 9
Initially, the extension set by the Financial Services Agency (FSA) of Japan was until December 9. Once the date was reached, the exchange would no longer be able to take or execute any business orders.
However, the exchange officials requested that they want to operate in Japan for a while so they can return the funds belonging to the users.
The exchange announced towards the end of November that they wanted to reinstate the withdrawals option for local users. They intended to release the funds they had locked for the investors on their platform.
The regulatory authority has, therefore, complied with the exchange’s request for goodwill. The regulator believes that the users will be able to benefit from the extension that the exchange is given.
Exchange to Return Funds to Creditors
The exchange still owes a great number of funds to creditors. Therefore, the regulator is also concerned about the creditors and wants their funds to be paid out by March 9, 2023.
Now that the exchange has an ample amount of time on their watch, they can utilize it to return the digital assets to the investors and the creditors.
With the FTX exchange going bankrupt, the FSA demanded FTX Japan cease its operations in the country.
As the regulator has given an extension to the exchange to release the funds, it has not done the same for the trading activity.
The regulatory authority has made it crystal clear that despite the withdrawals being available, the exchange is not allowed to run its trading operations.
This confirms that the regulators are concerned about the well-being of the investors and they want nothing to do with the exchange.
They are okay with the exchange ceasing its operations but they want the users to be able to withdraw their funds.
FTX Japan Wants to Operate
Although the regulator has made it clear that they do not want the exchange to operate, FTX Japan wants to continue operating.
Apart from submitting a request to the regulator for an extension, the exchange also submitted to continue its operations in the country.
The exchange officials revealed that they have a business improvement plan in order that they wanted the regulator to review.
The entire purpose was to make it clear that the exchange wants to run honest operations in the country. For now, the regulator has decided to leave that particular topic and is solely concerned about the investors’ funds.