Backpack Exchange Acquires FTX EU After Approval by Bankruptcy Court and Cyprus SEC

Backpack Exchange, a cryptocurrency trading platform founded by former FTX and Alameda Research employees, has officially acquired FTX EU, the European arm of the collapsed FTX exchange.

The acquisition, approved by the FTX bankruptcy court and the Cyprus Securities and Exchange Commission (CySEC), marks a significant step in Backpack’s expansion across the European Union.

FTX EU’s acquisition will allow Backpack to offer a range of crypto derivative services, including perpetual futures, to users across the EU.

Backpack EU Will Oversee Distribution of Funds to FTX EU Users

According to the company’s announcement on January 7, Backpack EU will also oversee the distribution of funds to FTX EU customers as part of the bankruptcy claims process approved by the court.

Backpack CEO Armani Ferrante emphasized the importance of customer restitution in the industry’s recovery.

“Returning funds to FTX EU customers quickly and safely is a critical step in rebuilding trust,” Ferrante said.

We're fully focused on working with all the relevant parties to return customer funds in the EU.

It's our top priority.

If you have an FTX EU claim, we'll announce next steps shortly. https://t.co/Wy2NBbSkRc

— Armani Ferrante (@armaniferrante) January 7, 2025

FTX EU’s suspension by CySEC, extended for six months in late 2024, prohibited the exchange from providing services but allowed it to process transactions and return client funds.

With Backpack EU’s upcoming license reactivation, the exchange is set to relaunch in the first quarter of 2025.

The company has promised to provide updates on asset access and onboarding for new users through its support channels.

The acquisition adds another layer to FTX EU’s turbulent history.

Originally known as Digital Assets AG (DAAG), a Swiss company, FTX acquired it in 2021 for $323 million.

Following FTX’s collapse in November 2022, several firms, including Coinbase, expressed interest in acquiring FTX EU. Ultimately, in February 2024, FTX sold the entity back to its original founders for $32.7 million.

Backpack, launched in 2022 by Solana developer Ferrante, initially gained $20 million in funding from FTX and Jump Crypto to build its platform.

Ferrante also created the non-custodial Backpack Wallet and the Solana developer tool Anchor.

The exchange’s co-founder, Tristan Yver, previously worked at FTX for two years before departing in May 2022.

During FTX’s collapse, Backpack suffered significant financial losses, with $14.5 million—88% of its operating funds—tied up in the exchange.

Cyprus Extends Suspension of FTX EU

In November, the Cyprus Securities and Exchange Commission (CySEC) extended its suspension of FTX Europe for another six months.

The decision, announced on November 5, delayed the firm’s ability to operate until at least May 30, 2025.

The extension prohibits FTX EU from offering services, advertising, or accepting new clients, though it allows the platform to complete transactions and return funds to existing clients.

Currently, the FTX Europe website no longer offers trading services. Instead, it provides users with a portal to view balances and request withdrawals.

Meanwhile, in the US, the Justice Department is seeking the return of up to $13.25 million in political contributions linked to former FTX executives, as revealed in a recent federal court filing.

Judge Lewis Kaplan, who is overseeing the criminal proceedings against former FTX CEO Sam Bankman-Fried and his associates, approved the government’s request for an extension until January 15 to negotiate with various political action committees (PACs).