Customers of FTX Japan will be able to withdraw deposits of crypto and fiat currency tomorrow, the Japanese subsidiary of bankrupt crypto exchange FTX said Monday.
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 honor 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.
"Japan is a highly regulated market with a potential market size of almost $1 trillion when it comes to cryptocurrency trading,” Bankman-Fried stated last June.
Last December, FTX filed a motion to approve the sale of the exchange’s four subsidiaries that remained solvent, which included FTX Japan, FTX Europe, Embed Technologies, and LedgerX. The effort would help raise money to repay creditors, who are owed billions of dollars.
More recently, the judge overseeing Bankman-Fried’s criminal case in the Southern District of New York has weighed an amendment to the FTX founder’s bail agreement that would bar him from using electronics completely, due to his use of a Virtual Private Network and sending encrypted messages via the application Signal.
And the team overseeing the exchange’s bankruptcy proceeding warned last Friday of scam tokens that falsely claimed to represent debt belonging to FTX customers. “The FTX Debtors have not issued any debt token, and any such offers are unauthorized,” the exchange tweeted.