The saga of the collapsed cryptocurrency exchange FTX has been inching toward a conclusion but some former parts of the FTX empire are still struggling to continue operations.
The Cyprus Securities and Exchange Commission (SEC) has extended the suspension of FTX Europe’s license, prohibiting the firm from offering services until September 2024.
Cyprus’ securities regulator officially announced the news on April 16, declaring that FTX Europe must proceed with necessary actions to comply with the relevant provisions of The Investment Services and Activities and Regulated Markets Law.
As part of the regulatory decision, FTX Europe is banned from providing investment services as well as entering into any business transaction with any person or accepting any new clients. The firm is also prohibited from advertising investment services, the announcement notes.
On the other hand, the regulator required FTX Europe to complete all its transactions and those of its clients upon their request. The Cyprus SEC ordered that the company will also have to return all funds and financial instruments attributable to its clients.
The news comes just a few weeks after a federal U.S. judge sentenced former FTX CEO Sam “SBF” Bankman-Fried to 25 years in prison on March 28 after being found guilty on seven counts of fraud and conspiracy to launder money.
After FTX collapsed in November 2022, its then-affiliated firm FTX Europe was named one of the firms included in FTX’s Chapter 11 filing in the United States.
Related: Sam Bankman-Fried asks to stay in Brooklyn prison for appeal
Before getting involved in the FTX empire, FTX Europe was known as Digital Assets AG, a Swiss crypto startup founded by Patrick Gruhn and Robin Matzke. Gruhn and Matzke sold the company to FTX in 2021 for $323 million, which subsequently rebranded to FTX Europe.
Following long-running bankruptcy disputes, FTX sold its subsidiary FTX Europe back to its founders Gruhn and Matzke in February 2024 for $32.7 million.
Following the settlement, Matzke reportedly claimed that FTX’s European expansion was going well until FTX failed internationally in November 2022, adding that the settlement was a good result.
“We are happy to support speedy payouts to EU clients,” Matzke said in February.
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