FTX Japan Loses Thousands of Users After Resuming Withdrawals

Following the resumption of withdrawals on February 21st, the Japanese unit of the defunct cryptocurrency company FTX has stated that thousands of customers have transferred their business elsewhere.

FTX Japan said in a statement made on February 22 that customers of both the exchange and those at Liquid Global had withdrawn around 6.6 billion yen (which was equivalent to approximately $50 million at the time of publishing) in cryptocurrency and fiat cash. The cryptocurrency company reports that 7,026 account holders have transferred cash from FTX Japan to Liquid, that 5,697 transactions have included cryptocurrencies, and that 1,947 customers have withdrawn fiat currency.

The cryptocurrency company said on February 20 that in order to make withdrawals, users of FTX Japan would first need to authenticate the amounts in their accounts and then transfer those funds to a Liquid account. For the first time in more than three months, withdrawals started up again around three in the morning UTC on February 21.

When its parent business filed for bankruptcy in November 2022, FTX Japan was part of the action. At that time, the corporation froze the assets of around 9 million members, denying them access to millions of dollars' worth of funds. According to a report by NHK at the time, FTX Japan had around 19.6 billion yen in cash when it suspended operations. This is equivalent to more than $138 million, which leads one to believe that there may be over $90 million remaining for consumers as of February 22.

Since November, the majority of FTX consumers, including those at FTX US, have been unable to withdraw their assets because of the bankruptcy processes that have been going on in the United States. The matter is now being heard in the United States Bankruptcy Court for the District of Delaware, where the judge has already ruled against a move to appoint an independent examiner on the grounds that doing so would be prohibitively expensive.