Bitflyer Takes Over FTX Japan Post-Bankruptcy

FTX Japan is reportedly set to be acquired by the Japanese cryptocurrency exchange BitFlyer, as announced by Japan's public broadcasting service.

NHK reported on Thursday that BitFlyer plans to spend several billion yen to purchase all shares of FTX Japan, thereby gaining full control of the company.

BitFlyer Holdings announced on June 20 that it would be acquiring and rebranding FTX Japan. Post-acquisition, FTX Japan will shift its focus from running a crypto exchange to providing institutional-grade crypto custody services. Initially, it will be renamed New Custody Company until a final name is decided.

BitFlyer stated that the acquired platform plans to offer services related to crypto exchange-traded funds (ETFs), which have not yet been introduced in Japan. These services will be designed to meet the needs of financial institutions such as trust banks, pending the establishment of the necessary legal framework and tax regulations for crypto asset spot ETFs in Japan.

Moreover, the New Custody Company will manage the transfer of FTX Japan customer accounts to BitFlyer, contingent on customer consent.

According to Nikkei, the acquisition cost BitFlyer several billion yen, amounting to tens of millions of dollars. FTX Japan, originally known as Liquid, was purchased and rebranded by Sam Bankman-Fried's FTX in early 2022, shortly before FTX's collapse in November 2022.

Following FTX's failure, FTX Japan maintained that its customers' assets were separate from FTX's bankruptcy proceedings. As a result, FTX Japan resumed withdrawals and reimbursed its customers in February 2023.

In 2022, FTX was actively acquiring crypto companies, including the $1.4 billion acquisition of the crypto brokerage firm Voyager Digital in October. In April 2024, a U.S. judge authorized FTX's debtors to enter a $450 million settlement with bankrupt Voyager.

This development follows Sam Bankman-Fried's recent sentencing to 25 years in prison in the United States after being convicted on seven felony charges.