Dubai’s Virtual Asset Regulatory Authority (VARA) canceled the license issued to FTX. FTX has been preparing official services in the Middle East, but has stopped its business due to bankruptcy.
VARA said Monday it will cancel the license issued to FTX. The cancellation of the license is, of course, due to the bankruptcy of FTX.
FTX acquired a virtual asset license in Dubai in March. VARA’s launch was a license issue announced in just a few days.
FTX said it will establish a regional headquarters (FTX MENA) in Dubai after issuing the license and carry out the Middle East exchange business. In July, Freed founder Sam Bankman tweeted that FTX was regulated by VARA.
However, the cancellation of the license will force FTX to leave Dubai before it does business properly. If FTX MENA had prepared virtual asset services through its local headquarters, it was reported that it was still in the test stage. VARA also added that FTX had not yet issued a domestic bank account regarding the cancellation of the license.
Meanwhile, FTX filed for bankruptcy protection under Article 11 of the Bankruptcy Act (Chapter 11) in the Delaware State Court on the 11th (local time). FTX’s bankruptcy filing, which has up to 66 trillion won in corporate debt alone, is the largest in the history of the virtual currency industry.
Chapter 11 of the U.S. Bankruptcy Act is a system that seeks rehabilitation by conducting restructuring procedures under the supervision of the bankruptcy court, unlike “Chapter 7,” which stipulates the liquidation of companies that are not likely to be revived.