A group of former FTX executives, led by Can Sun, the former FTX general counsel, is launching a new cryptocurrency exchange with a license from the Dubai Virtual Assets Regulatory Authority. The exchange aims to address the issues that led to the bankruptcy of FTX.
In the aftermath of the FTX bankruptcy, a group of former FTX executives, led by Can Sun, the former FTX general counsel, is joining forces to establish a new cryptocurrency exchange.
The initiative aims to address the issues that led to the downfall of their previous employer. Sun, a key witness in the criminal trial of ex-FTX CEO Sam Bankman-Fried (SBF), testified against SBF under a no-prosecution agreement.
The Wall Street Journal reports that Sun is spearheading the new exchange, which is set to launch in beta later this month. The venture seeks to sell a 10% stake to investors at a valuation exceeding $100 million.
Sun’s involvement was not initially disclosed when Backpack, the Web3 digital wallet company founded by Armani Ferrante, announced the exchange last month.
Claire Zhang, Ferrante’s wife and a former legal deputy of Sun’s, is also part of the executive board of Trek Labs, the Dubai-based entity operating as Backpack Exchange.
Trek Labs has obtained a license from the Dubai Virtual Assets Regulatory Authority (VARA), regulating digital assets in the region. Sun’s Trek Labs employs former FTX legal and compliance staff, with transparency being a key focus.
The former FTX general counsel emphasized the importance of trust and transparency in the post-FTX landscape.
Backpack Exchange plans to utilize Backpack’s technology to enable users to hold funds in their own “self-custody” crypto wallets, employing multiparty computation techniques for added security.
Users will have the ability to verify their holdings independently.
FTX, under SBF, faced issues where customer and company funds were commingled, leading to a substantial loss of customer deposits.
Having cooperated with federal prosecutors, Sun aims to build a crypto exchange with a commitment to trust and transparency, setting it apart in the evolving crypto landscape.
The launch of the new exchange is expected to have a positive impact on the crypto industry, as it offers a regulated and secure platform for trading digital assets.
The exchange also benefits from the Dubai license, which gives it access to a large and growing market in the Middle East.
The new exchange also poses a challenge to the existing players in the crypto space, especially FTX, which is still struggling to recover from its bankruptcy and legal troubles.
The new exchange could attract former FTX customers and investors who may be looking for a more reliable and transparent alternative.
The new exchange also represents a personal redemption for Sun and his team, who were involved in one of the biggest financial scandals in crypto history.
By launching a new exchange with a different vision and values, they hope to restore their reputation and credibility in the crypto community.
