FTX Europe, the European arm of crypto exchange FTX, has won regulatory approval from the Cyprus Securities and Exchange Commission (CySEC) to function as a Cyprus investment firm (CIF).

As per the Thursday announcement, FTX Europe is now capable of fully owning the local investment firm it had previously acquired and using it to serve its customers. With the approval from the CySEC, FTX aims to increase its presence in the European region.

"After launching our European operations earlier this year we're excited to receive approval from the regulators in Cyprus. Operating under this license will further our goal of being a European entity regulated to the highest standard. We look forward to continuing our productive relationship with CySEC as we continue to expand our European offerings," said Patrick Gruhn, Head of FTX Europe.

Additionally, the Cyprus Investment Firm (CIF) License granted by the CySEC will require FTX Europe to comply with local laws and financial standards under the European Directive 2014/65/EU on Markets in Financial Instruments (commonly called the "MiFID II" framework). The MiFID II framework is focused on "the segregation and protection of client funds, full transparency of its business operations, and capital adequacy controls."

The announcement further added that with the regulatory approval from the CySEC, FTX EU now has access to the entire European Economic Area and is now the only "crypto exchange worldwide to provide a full suite of exchange services under a full MiFID II license, which is held to much higher standards than local registrations as Crypto Asset Service Providers."

Cyprus is a well-renowned region for investment firms as it provides regulated firms access to the whole European Economic Area via "passporting" which includes member states of the European Union, Iceland, Liechtenstein, and Norway.

As per earlier reports, the CySEC had also approved another major crypto exchange Crypto.com to operate as a crypto broker in the country after it was registered with the regulatory authority as Crypto Asset Service Provider. British financial technology company Revolut was also approved by CySEC to expand crypto offerings across the European Economic Area (EEA).

FTX CEO Sam Bankman-Fried poses for a picture, in an unspecified location, in this undated handout picture, obtained by Reuters on July 5, 2022. FTX/Handout via REUTERS
FTX CEO Sam Bankman-Fried poses for a picture, in an unspecified location, in this undated handout picture, obtained by Reuters on July 5, 2022. FTX/Handout via REUTERS Reuters / FTX
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