Press Conference by SUZUKI Shunichi, Minister of Finance and Minister of State for Financial Services

(Excerpt)

(Tuesday, November 15, 2022, 9:23 am to 9:31 am)
 

[Questions and answers:]

Q.

FTX Trading Ltd., a leading crypto-asset exchange service provider, and its group of 130 companies have filed for Chapter 11 of the United States Bankruptcy Code. A Japanese subsidiary is also included. What is the impact on Japanese users? Also, disruptions in financial markets including crypto-asset markets have been observed. What kind of measures are under consideration?

A.

We understand that upon the fact that FTX Trading Ltd., and its group companies including a Japanese subsidiary have filed for bankruptcy procedures under the U.S. bankruptcy law, the FTX Japan Inc. is currently confirming its impact and future measures for returning client assets.
The FSA is closely monitoring the impact of filing for Chapter 11 and the response of FTX Japan Inc.
In any case, the FSA believes that the protection of assets of users of FTX Japan Inc. is well implemented as follows

1. Under the Payment Service Act and the Financial Instruments and Exchange Act of Japan, business operators shall manage and preserve users' assets separately from their own assets.

2. Due to the recently issued administrative actions by the Kanto Local Finance Bureau, FTX Japan Inc. is required to hold its asset in Japan, to preserve customers' assets, and not to expend company assets unduly.

3. At the Company itself, it has been made public that it is in excess of assets and the assets of users are also managed and preserved by the Company.

And next, your question concerns the policy regarding the impact of this case on the crypto-asset market and other financial markets.

At this point, the impact on financial markets other than crypto-asset markets is limited, so that we do not believe that any immediate action is necessary.
However, we are not prejudging the impact of this incident and continue to closely monitor the situation with a sense of tension.