Who had regulatory oversight over FTX? A look under the hood.
In the wake of FTX's collapse, the empire's regulatory footprint paints a picture of the regulators worldwide who had oversight of the company and its associated activities.
On 11 November 2022, FTX Trading Ltd. and 133 of its affiliated entities petitioned the US Bankruptcy Court in Delaware to be placed in Chapter 11 bankruptcy. In a series of subsequent tweets, FTX named seven subsidiaries and other entities that were explicitly not included in the bankruptcy proceedings. In the wake of FTX’s colossal collapse, the regulatory footprint of the FTX empire paints a picture of regulators around the world who had oversight of the group and its associated activities.
Data from VASPnet indicates that roughly 11%of the petitioning companies were authorised or allowed to conduct cryptoasset services and the United States was not the only jurisdiction with regulatory oversight. Of the 141 mentioned, 16 were regulated to conduct virtual asset service provider (VASP) activities; 12 of which were included in the bankruptcy petition and four of which were not.
Of the 12 included in the proceedings, six are regulated in the United States by the Commodity Futures Trading Commission (CTFC), the Securities and Exchange Commission (SEC) or the Financial Crimes Enforcement Network (FinCEN).
Of the remainder, five are regulated by the Financial Conduct Authority (FCA) in the UK, the Dubai Virtual Assets Regulatory Authority (VARA) or Dubai Multi Commodities Centre (DMCC) in the United Arab Emirates, the Gibraltar Financial Services Commission (GFSC) in Gibraltar or the Financial Services Authority (FSA) in Japan.
Finally, Quoine Pte. Ltd. was granted exempt status by the Monetary Authority of Singapore (MAS) due to the fact that the firm applied to be regulated under Singapore’s regime prior to 28 July 2020 and is therefore allowed to continue providing specific payment services until their application is either approved or rejected.
Here is the list of the 12 regulated entities included in the bankruptcy petition:
Of the seven entities that FTX mentioned as being excluded from the bankruptcy proceedings, four are regulated by the Securities Commission of The Bahamas (SCB), the Australian Securities & Investments Commission (ASIC) or the Financial Industry Regulatory Authority (FINRA) in the United States.
Here’s the list:
On social media, FTX acknowledged that companies it does not own or control are not included in the bankruptcy. Two companies specifically mentioned, which were included in the original filing, were Bitvo Inc. and BTC Africa S.A.. Bitvo Inc. is regulated by the Financial Transactions and Reports Analysis Centre (FINTRAC) in Canada. BTC Africa S.A. is regulated by the Financial Crimes Enforcement Network (FinCEN) in the United States.
Questions about the regulatory status of service providers conducting cryptoasset activities? Get in touch with us at firstname.lastname@example.org.