Shambhavi SoniFTX Relocates From Hong Kong to Bitcoin-Friendly Bahamas. Founder and CEO Sam Bankman-Fried pointed to regulatory clarity as a reason behind the move. Cryptocurrency exchange with a colossal size Binance has been tight-lipped regarding its location. Its main rival has no such problems.
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According to its website, FTX, the second-most popular crypto trading platform, has officially relocated its headquarters from Hong Kong to the Bahamas. It is still a part of Antigua and Barbuda.
FTX Trading Limited received licences for subsidiaries in Gibraltar and the Bahamas earlier this week. It will operate under the name FTX Digital Markets in the latter, where the Securities Commission of the Bahamas has registered it as a digital assets business.
The Bahamas is bitcoin-friendly
“The Bahamas is one of the few nations to set up a full framework for crypto,” FTX founder and CEO Sam Bankman-Fried stated on Twitter. He went on to say that the country “has emerged from COVID alive, safe, and quarantine-free.”
The Bahamas, like other Caribbean nations like Bermuda, has embraced bitcoin firms. Last year, the Bahamas began issuing the Sand Dollar, digital money issued by the central bank. Deltec Bank, situated in the Bahamas, already provides services to FTX, Tether, and other cryptocurrency exchanges.
Furthermore, in late 2020, the country passed the Digital Assets and Registered Exchanges Bill, which allows crypto and other Fintech companies to be licenced. The first digital asset bill to have registered under the statute is FTX Digital Markets. Executive Director Christina Rolle of the Securities Commission praised the DARE Act’s role in bringing FTX to the island—and hinted that additional crypto firms may follow.
“It’s a huge vote of confidence for the jurisdiction,” she told The Tribune of the Bahamas.
“What it signals is that you have a big player like this that is really looking for a jurisdiction that has clearly defined the scope of its regulation, and that is what DARE provides.” Imagine Gary Gensler saying something like that.
On Monday, Bankman-Fried tweeted, “Having a comprehensive, agile regulatory framework with supervision is crucial to ensuring that the crypto business is safe, robust, and thriving.” “We’re ecstatic to be one of the first worldwide crypto exchanges to be regulated in a full spot + derivatives framework.”
Semi-autonomous Hong Kong, on the other hand, is becoming increasingly aligned with mainland China. The Chinese authorities underlined Thursday that cryptocurrency trading is still illegal, even while work on digital yuan proceeds. Binance was under pressure to stop allowing Hong Kong users to trade derivatives on its platform last month. Derivatives include futures, options, and perpetual contracts. It claimed a “commitment to compliance” as the reason.
Hong Kong as a business centre
FTX also generates the majority of its exchange volume via crypto futures rather than spot trading. Making Hong Kong a less-than-ideal site for a headquarters.
In addition, Hong Kong, a major business centre, requires guests to stay in a hotel for up to three weeks. As FTX increases its reach and forges new relationships, this limits its capacity to move swiftly.
Amy Wu, a partner at Lightspeed Ventures who invests in FTX, told Decrypt that she sees the move as beneficial. “Without the quarantines, the Bahamas has been crypto-friendly, open to dialogue, and allows the [management] team to be more nimble.”