FTX Regional Crypto Exchanges Slowly Reopening Withdrawals

FTX Japan said it resumed yen withdrawals after Japan’s regulator, the Financial Services Agency (FSA), raised concerns about the health of the crypto exchange. Elsewhere, FTX Turkey said it was working on sending all Turkish lira balances to its customers.

FTX Japan made the announcement in a short statement on its website on Friday. FTX Turkey communicated its message in a friday tweet. On Thursday, the Turkish subsidiary announced that it will automatically convert user balances into Turkish liras at a 1:1 ratio.

Japan’s FSA on Thursday ordered FTX Japan to enter “close-only” mode, which means users should be able to liquidate existing positions, but not initiate new ones. In the order, the regulator noted that the exchange had halted withdrawals without specifying a date for reinstatement and that it continued to recruit new customers.

Under these circumstances, the regulator said it was uncertain about the health of the business. It also forced FTX Japan to stop accepting new clients and halt exchange activities.

These regional FTX subsidiaries are 100% owned by FTX’s “mother ship” in Antigua, FTX Trading Ltd, and license FTX’s technology stack in exchange for royalty payments sent back to the Antigua-based parent company. Regional exchanges comply with local securities laws and thus offer a limited selection of tokens (similar to regional Binance affiliates). With this compliance, they can access local payment rails, meaning merchants don’t have to use expensive and slow SWIFT transfers to deposit or withdraw funds.

Some traders have been known to treat them as a payment gateway for buying stablecoins, before sending them to the main exchange for a full trade.

Withdrawals on FTX International remained paused from Asian hours on Friday.

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