MAS addresses FTX collapse, says users have no protection as FTX not licensed in Singapore

Steffy Bogdanova
November 22, 2022 9:22 am

The Monetary Authority of Singapore (MAS) has issued a statement regarding the collapse of crypto exchange FTX.

The Singapore regulator addressed the misconception that it could protect users of FTX, noting that it can take no action as FTX is not licensed by MAS and operates offshore. Furthermore, the financial regulatory authority has frequently warned about dealing with unregulated entities.

The financial markets regulator also responded to the belief that it could have protected the assets of Singaporean investors if they were in separated in in the crypto exchange’s local subsidiary, Quoine Pte Limited. MAS reminded that like other FTX subsidiaries, Quoine has been included in the US bankruptcy proceedings and has stopped withdrawals.

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The Singaporean regulator’s statements follow the sudden quick collapse of FTX which began with a liquidity crisis, a failed bailout, which Binance backed out from, and an over $600 million hack, forcing the crypto exchange to file for bankruptcy in the US.

After the former CEO and founder of FT, Sam Bankman-Fried, was replaced, the new CEO, John Ray III, described the collapse of the exchange as “a complete failure of corporate controls”.

It has been reported that Bankman-Fried lent millions of FTX customer funds to Alameda Research, which is also owned by him, for leveraged crypto trades. After questionable record keeping, the exchange ran into a “liquidity crunch”, as its balance sheet became public knowledge.

LeapRate Analyst

Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
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