02-20-2023 icon

FTX users in Japan will start withdrawing funds tomorrow

By Lucy Adegbe

The subsidiary of bankrupt FTX protocol in Japan has said its customers will be able to withdraw deposits of crypto and fiat currency tomorrow.

According to the report, the withdrawal process will be facilitated through Liquid Japan, a crypto trading platform purchased by FTX last spring. 

The company’s announcement comes after FTX Japan paused withdrawals last November as founder and former CEO Sam Bankman-Fred’s crypto empire came crumbling down. The Tokyo-based company stated that customers who are eligible to withdraw their funds have already been notified about the process via email, which requires them to create an account with Liquid Japan and confirm the existing balance of their FTX Japan account.

“We would like to express our deepest apologies,” FTX Japan stated in a blog post. “The bankruptcy of our parent company has had a wide range of impacts, and we have had to wait for a long time to resume operations.”

FTX Japan warned that the withdrawal process may become bogged down by a large volume of customers submitting requests at once. On December 1, the platform held around $94.5 million in crypto and $46 million in fiat currency, according to Bloomberg

Though customers of FTX Japan will soon see some reprieve, customers who did business with other subsidiaries of FTX, like FTX.US, remain in limbo as the international exchange works its way through bankruptcy proceedings in a Delaware court.

FTX filed for bankruptcy in November of last year after a run on the exchange was triggered by a steep drop in the price of the exchange’s native cryptocurrency FTT. As assets flowed out of the exchange, it revealed FTX did not have one-to-one reserves of customer assets, could not honour withdrawals, and forced it to file for bankruptcy.

Bankman-Fried was later arrested and charged with a litany of financial crimes, such as wire fraud and conspiracy to commit money laundering, to which he has since pleaded not guilty. 

FTX Japan launched in June of last year and operated for less than six months before Bankman-Fried’s companies collapsed. Bankman-Fried was appointed as the company’s interim CEO when the subsidiary launched.