CySEC requested FTX’s European arm suspend operations prior to bankruptcy: Report

Regulation

The Securities and Exchange Commission of Cyprus, or CySEC, reportedly issued a statement amid FTX filing for Chapter 11 bankruptcy in the United States requesting the exchange halt operations for its Europe arm.

According to a Nov. 11 Reuters report, the CySEC said it had asked FTX Europe to “suspend its operations and to proceed immediately with a number of actions for the protection of the investors” on Nov. 9. It’s unclear why the financial regulator chose to reiterate its call to the crypto exchange, given that FTX Europe is one of roughly 130 companies in FTX Group that will be filing for bankruptcy.

CySEC approved the FTX arm to operate in the island nation from its regional headquarters in March, with its European headquarters based in Switzerland. Amid FTX’s liquidity issues, global financial policymakers have responded with suggestions for additional regulations on crypto firms, as well as freezing assets with the exchange’s local businesses, as was the case in the Bahamas.

Related: Crypto.com scores regulatory approval from Cyprus SEC

FTX CEO Sam Bankman-Fried said on Nov. 11 he would be working on “giving clarity on where things are in terms of user recovery” as soon as possible. He resigned amid bankruptcy proceedings, with John Ray taking over as CEO.

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