22-316MR ASIC suspends FTX Australia’s AFS licence

On 16 November 2022, the Australian Securities and Investment Commission (ASIC) suspended the Australian Financial Services (AFS) licences of FTX Express Pty Ltd (ACN 657 907 894) and FTX Australia Pty Ltd (ACN 129 217 812) (together, FTX Australia) until 15 May 2023.

This was as a result of FTX Australia being placed into voluntary administration on 11 November 2022.  KordaMentha have been appointed as the voluntary administrators (Administrators) of FTX Australia.  Prior to its suspension, FTX Australia’s licences enabled it to deal in, make a market for and provide general advice regarding derivatives and foreign exchange contracts to retail and wholesale clients.

In addition, it is worth noting that on the same day, FTX Trading Ltd, West Realm Shires Services Inc (trading as FTX US) and its other affiliated companies commenced concurrent voluntary proceedings under Chapter 11 of the United States Bankruptcy Code.

Following FTX Australia being placed into voluntary administration, between 16 November and 19 December 2022, FTX Australia were authorised to provide limited financial services in relation to the termination of existing derivatives with their clients.

As the situation develops both overseas and domestically with so many potential stakeholders being impacted, ASIC is monitoring this situation closely. ASIC is regularly having discussions with its fellow international regulators, counterparts and external administrators as the flow on effects and consequences of FTX US’ bankruptcy are felt worldwide.

ASIC has continued to encourage FTX Australia’s clients to also closely monitor the situation.

If you have been impacted by FTX’s collapse, please contact us and we can assist you.

If you found this insight article useful and you would like to subscribe to Gadens’ updates, click here.

Authored by: 

Matthew Bode, Partner
Elizabeth Ziegler, Associate
Munkh-Erdene Saruul, Paralegal