Japanese cryptocurrency exchange BitFlyer will acquire the Japanese arm of the collapsed crypto trading platform FTX.
BitFlyer Holdings is acquiring and subsequently rebranding FTX Japan, the firm officially announced on June 20.
Following the acquisition, FTX Japan’s core business will shift from operating a crypto exchange to an institutional-grade crypto custody service. It will initially be rebranded New Custody Company, as the new name has not yet been determined.
BitFlyer to turn FTX Japan to institutional crypto custody under a new name
In the announcement, BitFlyer mentioned that the acquired platform aims to provide services related to crypto exchange-traded funds (ETFs), which have yet to be launched in Japan.
“While we will need to wait for the establishment of the legal system, including tax regulations, if crypto asset spot ETFs are approved in Japan, services related to crypto asset spot ETFs that meet the needs of financial institutions, including trust banks, will also be offered under New Custody Company,” BitFlyer noted in the announcement.
New Custody Company will also transfer FTX Japan customer accounts to bitFlyer, with the consent of the relevant customers, the announcement notes.
According to local news agency Nikkei, the acquisition cost BitFlyer billions of yen, or tens of millions of dollars.
The post-FTX saga continues to unfold
FTX Japan is a Japanese-based crypto exchange formerly known as Liquid. Sam BankmanFried’s FTX exchange acquired Liquid in early 2022 and rebranded to FTX Japan just a few months before the FTX empire collapsed in November 2022.
Following FTX’s failure, FTX Japan repeatedly argued that its customers’ assets were not part of FTX’s bankruptcy proceedings and eventually resumed withdrawals and repaid its customers in February 2023.
Related: Japanese crypto exchange raises $320M to recover funds after major hack
FTX was aggressively acquiring crypto companies in 2022, including the $1.4 billion purchase of the crypto brokerage firm Voyager Digital in October 2022. In April 2024, a U.S. judge granted a motion authorizing debtors for FTX to enter a $450-million settlement agreement with bankrupt Voyager.
The news came a few weeks after Bankman-Fried was sentenced to 25 years in prison in the United States following his conviction on seven felony charges.
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