FTX Japan to Allow Customers Access to Withdrawals via Liquid

FTX Japan, the Japanese arm of the collapsed crypto exchange platform FTX, has announced plans to return customers’ funds as early as February 2023.

The press release by the firm details a proposed roadmap for making users access their funds via withdrawals through the website of Liquid Japan, a sister platform. The firm has now proposed a three-step approach for its FTX Japan and Liquid Japan users to access their funds again. 

Beginning in mid-January, FTX Japan will send an email containing a link to open a Liquid Japan account to all users qualified for a refund. Afterward, these users can then access their funds and transfer their assets from FTX Japan to Liquid Japan from where they can then be withdrawn.

However, the firm mentioned that some of these users may be subjected to Liquid Japan’s unique identity verification process before the newly opened account can be activated. Adding that it will notify individual users if this process was required. Additionally, this proposed timeline is still subject to change depending on the progress of its external security audit.

Recall that FTX acquired Liquid Group and all of its operating subsidiaries in March for an undisclosed fee. After the acquisition, it agreed to provide its existing Japanese customers with services in compliance with Japanese laws.

FTX Japan Users Saved by Japanese Legislation

Interestingly it would appear that Japanese investors are saved due to the legislation that requires crypto exchanges to keep clients’ funds separate from their assets.

Earlier in the month, FTX Japan confirmed that customers’ assets were not part of the bankruptcy proceedings of its parent company. The company updated its website to reflect this fact and has since then made it a priority to allow users to access their funds via withdrawals.

After FTX’s bankruptcy filing, both FTX Japan and Liquid Japan halted withdrawals on their platforms after instructions from FTX’s bankruptcy representative. Even though it halted withdrawals on the platform, FTX Japan via a tweet assured users that their funds were safe as its cold wallet reserves are greater than customers’ deposits in compliance with the law.