FTX Japan, the Japan-based sub-branch of the now-bankrupt crypto exchange FTX, intends to devise a roadmap for restarting withdrawals. The company has come to this decision after clarifying that the assets of the consumers are not included in its bankruptcy proceedings. The platform offered an update on the 1^st of December 2022. On the other hand, FTX Founder, SBF, has negated the allegations of fraud with clients.

FTX Japan Intends Giving Back Users’ Funds by Restarting Withdrawals

It mentioned that, in line with the regulations implemented in the land of the rising sun, they have confirmed that the assets of the users should not be included in the estate of FTX Japan. This is because the law in Japan mandates that the entities offering crypto services must distinguish between the user funds and the assets of their own. This has been pointed out by Landis Rath & Cobb LLP (the firm denoting FTX in the Chapter 11 bankruptcy proceedings.

The launch of FTX Japan has taken place in June 2022 after the acquisition of Liquid (a crypto exchange) on the 2^nd of February this year. The platform was meant to serve the Japan-based users of the exchange. Nonetheless, severe liquidity problems were gone through on the behalf of its parent firm earlier the previous month. Thus, FTX Japan halted withdrawals on the 8^th of November, just like its parent entity.

Later, the Japanese FSA declared on 10^th November that it had carried out an administrative measure against FTX Japan. The agency directed it to stop the rest of the business operations including accepting the latest deposits. After that, the firm was listed among the 134 firms that participated in the bankruptcy filing of FTX.

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The Firm Endorses that User Assets Are Excluded from Bankruptcy Proceedings

Following that, the attention of the excgnage has been focused on re-enabling consumer withdrawals. The entity reportedly targets to do this by this year’s end. The recent endorsement, that the assets of customers do not come under the estate of FTX Japan, would play a vital role in making a way to restart the withdrawals. The company noted that the management is making discussions with the regulatory agencies of the country in this respect. It hopes that these efforts would be fruitful in the future.