USDBackpack Exchange Expands into EU with $32.7 Million FTX EU Acquisition
Regulatory Approval Sets the Stage for Strategic Growth
Backpack Exchange has secured a significant foothold in the European cryptocurrency market with its $32.7 million acquisition of FTX EU, the European arm of the defunct FTX platform. The deal, approved by both the FTX bankruptcy court and Cyprus Securities and Exchange Commission (CySEC), grants Backpack EU access to FTX EU's MiFID II license. This regulatory framework enables the exchange to offer compliant crypto derivatives across Europe, positioning it as a key player in the region’s evolving crypto landscape.
The acquisition aligns seamlessly with the EU’s newly introduced Markets in Crypto-Assets Regulation (MiCA), which has tightened compliance requirements for crypto services since its implementation on December 30, 2024. While other exchanges have scaled back operations in response to MiCA, Backpack Exchange is moving against the tide, leveraging this regulatory clarity to solidify its market presence. The CEO of Backpack Exchange, Armani Ferrante, described this expansion as a calculated move to dominate the regulated perpetual futures trading market in the EU, a significant niche left underserved due to mounting regulatory pressures on offshore exchanges.
The launch of Backpack EU is slated for Q1 2025, with a phased rollout of trading products, including spot, margin, and futures trading. The initial focus, however, will be on returning EURO-denominated customer funds linked to FTX EU accounts. Customers will be required to register with Backpack EU using the same email credentials associated with their FTX EU claims to facilitate the repayment process. It’s important to note that these repayments will exclusively cover claims related to FTX EU, excluding liabilities tied to other FTX entities.
FTX EU’s repayment amounts are currently under determination by the bankruptcy court, but Backpack Exchange has assured swift and secure processing as a top priority. This approach is seen as an effort to restore trust in the digital asset industry, which has faced scrutiny following FTX’s collapse. The broader reorganization of FTX, announced on January 3, 2025, underscores this shift. As part of the reorganization plan, payments to Convenience Class creditors with claims under $50,000 are being disbursed, with initial phases managed by Kraken and BitGo. Total distributions are projected between $14.7 billion and $16.5 billion, potentially returning 118% of affected customers' original investments.
The deal highlights the growing importance of regulatory compliance in maintaining operational viability in Europe. While the introduction of MiCA has fostered a structured market environment, it has also caused notable shifts, such as the delisting of certain tokens, including Tether’s USDT, from EU markets. These regulatory shifts have created both challenges and opportunities, with Backpack Exchange clearly opting to capitalize on the latter. Speculation suggests that funds distributed to FTX creditors may eventually re-enter the crypto market, potentially igniting bullish trends and adding momentum to Backpack EU’s market debut.
This article has been refined and enhanced by ChatGPT.
