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- Backpack Exchange has acquired FTX EU and will handle customer claims while ensuring regulatory compliance.
- The company is expanding in Europe with new licensing and plans to launch crypto derivatives in early 2025.
Backpack Exchange has bought FTX EU, the European subsidiary of the recently failed crypto exchange firm FTX. The deal has received approval from the FTX bankruptcy court and the Cyprus Securities and Exchange Commission. Backpack Exchange will distribute previously approved bankruptcy claims to affected FTX EU users as part of the agreement.
Armani Ferrante, the CEO of Backpack Exchange, also stressed the aspect of customer reimbursement, which we covered in our latest report. The company is ensuring FTX EU users that they will get their money back as soon as possible and as safely as possible. The decision is credited as an attempt to regain investors’ confidence within the crypto sector due to the FTX crash in late 2022.
Compliance with EU’s MiCA Regulation Strengthens Market Trust
Backpack Exchange, a digital wallet and trading company established by ex-FTX and Alameda Research employees, is set for growth with regulatory licenses in several jurisdictions. To continue its growth in Europe, the company obtained a Markets in Financial Instruments Directive II (MiFID II) license and acquired a license from the Dubai Virtual Assets Regulatory Authority.
As noted in our earlier post about the new Backpack EU platform, derivatives such as perpetual futures will be launched across European territory. The exchange also aims to include SEPA, Payments, and wire transfers in other major European currencies. This expansion is in line with the European Union’s Markets in Crypto-Assets (MiCA) regulation, which lays down the rules for the sector and protects consumers.
He pointed out that regulation has become more important in the evolving landscape and that being able to acquire the MiFID II license is a clear sign to the market that the company is serious about transparency and security. While several international exchanges are opting out of the European Union, Backpack Exchange seeks to seize the opportunity and provide a functioning, regulated exchange.
FTX EU’s Bankruptcy and Its Influence on Crypto Regulations
Alameda Research’s former engineer, Ferrante, launched Coral, a crypto infrastructure company, in 2022. It created apps and protocols for decentralized trading and wallet the Backpack trading and wallet technology stack, raising $20 million in funding from Jump Crypto FTX Ventures and other investors. However, a sizeable portion of these funds has been pulled out when FTX went bust. Ferrante’s co-founder Can Sun earlier worked at FTX exchange as a general counsel, and after that, he testified against the company’s founder, Sam Bankman-Fried.
FTX filed for bankruptcy in November 2022, disrupting the cryptocurrency market. As detailed in our last news piece, Bankman-Fried was charged with fraud and conspiracy, found guilty in 2023, and sentenced to 25 years in jail.
With the integration of FTX EU in Backpack Exchange, achieving positive progress in addressing other outstanding issues on the remains of the former clients would help strengthen Backpack Exchange’s commitment to providing better regulation in Europe’s cryptocurrency market. With these new licensing and infrastructure improvements, Backpack EU is slated to go live in early 2025, ready to assume a strategic role in the continuously emerging digital asset environment.
