A little over two years ago, FTX, the second largest cryptocurrency exchange, abruptly closed its doors. Sam Bankman-Fried's entire empire was forced to declare bankruptcy. This is the case of the European division of FTXnamely FTX.eu, which was launched in March 2022 on the island of Cyprus.
The Cypriot jurisdiction allowed the exchange to offer its services throughout the European Economic Area without having to apply for additional authorizations. Building on its success at the time, FTX had in fact decided to establish itself on the old continent and to religiously comply with the requirements of local regulators.
Also read: FTX demands a fortune from Binance, 2 years after its bankruptcy
Backpack Exchange buys FTX Europe
This subsidiary has just been bought by Backpack Exchangea regulated crypto exchange platform which also offers a non-custodial wallet, whose keys are managed by users. It supports multiple blockchains, including Solana, Ethereum, Arbitrum, Base, Polygon, Optimism and Eclipse, and integrates solutions for NFTs.
As the exchange explains in a press release addressed to 01netthis acquisition “marks a major milestone in Backpack’s international expansion and demonstrates its commitment to providing secure and regulated trading solutions across Europe.” By relying on FTX Europe, Backpack will above all be able to provide tools intended for traders.
This European strategy is largely based on la licence MiFIDalready granted to FTX Europe. This license will allow Backpack to offer crypto derivative products on European territory. The exchange from Singapore underlines that Europe is a market “where no regulated crypto derivative product is currently available”. Indeed, several internationally based platforms have been forced to give up their derivative products in recent years.
“As many international crypto-asset trading platforms leave the European Union, becoming a MiFID II approved entity demonstrates our commitment to the highest regulatory standards and is an important step in offering transparent crypto-asset trading, secure and regulated in a previously neglected European market”argues Armani Ferrante, CEO of Backpack Exchange.
Mirroring Backpack, giants of the ecosystem, like Coinbasehave worked hard to offer derivative products in Europe. Recently, Coinbase in fact got its hands on the Cypriot branch of Bux, a brokerage company, with the prospect of obtaining a MiFID license which will open the doors to Europe. Competition is likely to increase in the derivatives market, which represents 75% of cryptocurrency trading volume, according to Coinbase.
By purchasing the European subsidiary of FTX, Backpack takes ownership the ambitions formerly displayed by Sam Bankman-Fried. The philanthropist indeed aimed to make FTX “one of the most regulated stock exchanges in the world”. Backpack plans to offer its services to European traders before the end of the first quarter of 2025. In addition, the exchange will allow you to fund your account with euros by making instant transfers.
Note that Backpack was set up by… several former FTX executives. The exchange was in fact developed by Trek Labs, a start-up born in Dubai in 2023. Among the leaders, we find Can Sun, the former lawyer of FTX, Armani Ferrante, another FTX executive, and his wife , Claire Zhang, who was Can Sun's legal advisor at FTX.
FTX Europe refunds
By taking control of FTX Europe, Backpack finds itself in charge of victim reimbursements of the European subsidiary of the FTX group. They were in fact able to request a reimbursement using a form posted online during the summer of 2023.
After months of waiting, refunds will be issued as soon as possible, Backpack says. For the Singaporean firm, “Customer refunds are a critical part of restoring confidence in the industry, and Backpack is committed to returning FTX EU customer funds as quickly and safely as possible.wheat “. On its site, Backpack talks about a refund during the first half of the year.
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