Digital Surge collapses into administration following collapse of crypto exchange FTX

Australian cryptocurrency exchange Digital Surge fell into administration just weeks after the collapse of multibillion-dollar crypto exchange FTX.

Some 30,000 Australian clients are now unable to move or withdraw money on the trading platform.

It comes after the Brisbane-based company was forced to temporarily suspend all deposits and withdrawals last week following the collapse of FTX.

Australian cryptocurrency exchange Digital Surge fell into administration just weeks after the collapse of billionaire cryptocurrency exchange FTX (file image)

Some 30,000 Australian clients are now unable to move or withdraw money on the trading platform (file image)

FTX, which is based in the Bahamas, filed for Chapter 11 bankruptcy on November 11 following mismanagement and allegations that former FTX CEO Sam Bankman-Fried used client money to fund gambling. investment with Alameda Research.

Digital Surge was created in 2017 and allowed clients to access 300 digital currencies and used the FTX platform for some of its operations.

KordaMentha Restructuring has been appointed as administrator following the collapse of the trading platform.

“We fully appreciate the uncertainty that voluntary administration will create,” said Scott Langdon, partner at KordaMentha.

“We will proactively and regularly communicate with customers to ensure they are fully informed about the progress of the administration.”

Australia’s financial watchdog, ASIC, recently warned Australians that the cryptocurrency market was “risky.”

“Crypto exchange businesses are not regulated by ASICs and crypto assets are largely unregulated in Australia,” he said.

ASIC is very concerned that Australians who invested in cryptocurrency have not fully understood the risks and have lost money in this year’s collapse in valuations.

“ASIC has repeatedly warned investors that cryptocurrencies are incredibly risky, inherently volatile, and complex.”

It comes after the Brisbane-based firm was forced to temporarily suspend all deposits and withdrawals following the collapse of FTX (pictured is former CEO of imploded cryptocurrency exchange FTX, Sam Bankman-Fried)

In a letter sent last Tuesday and first published by CoinDesk, former FTX CEO Sam Bankman-Fried wrote that he was “sorry.”

‘I didn’t want any of this to happen, and I would give anything to go back and do things again. You were my family.

His apology comes as the chief executive faces a possible US government investigation over allegations that he used FTX client money to fund investment bets with Alameda Research, a sister company and trading firm run by his ex-girlfriend Caroline Ellison.

His team of 10 close friends ran a glorious frat house out of their $40 million home in the affluent Albany district of the Bahamas, the New York Post alleges.

A local resident told the Post: ‘They were walking around in sweatshirts and T-shirts. That was not the Albany lifestyle that residents there signed up for. The typical clothing was Ralph Lauren sport jackets. Sam and his group didn’t seem to fit the role.

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