In a strategic move set to reshape Europe’s crypto trading landscape, Backpack Exchange has acquired the European arm of the bankrupt FTX empire, FTX EU, for $32.7 million. This acquisition positions Backpack as a leading player in the burgeoning regulated cryptocurrency derivatives market across Europe.
A MiFID II-License and New Horizons
FTX EU held a coveted MiFID II license under the Cyprus Securities and Exchange Commission (CySEC), making it one of the few entities equipped to offer regulated financial products in the EU. Backpack plans to leverage this license to launch a full suite of crypto derivatives, starting with perpetual futures—a product currently unavailable from other regulated entities in the region.
“We’re excited to be the first regulated perpetual futures provider in the EU,” said Armani Ferrante, CEO of Backpack Exchange. “Once we return FTX EU customers’ funds, our priority will be to launch this product and build a robust suite of offerings.”
Backpack’s European Ambitions
The acquisition comes at a time when Europe’s regulatory framework for cryptocurrencies is evolving. The Markets in Crypto Assets (MiCA) regime, which standardizes crypto regulations across the EU, offers firms with MiFID licenses the ability to expand their services seamlessly. Backpack has already submitted its MiCA notification, aiming to launch its offerings by Q1 2025.
Ferrante highlighted the significance of this regulatory edge, stating, “Even though several firms have obtained approval for limited derivatives licenses, none currently offer live perpetuals in the EU, including major players like Coinbase and Bitstamp.”
Rising Competition in the EU Crypto Market
Backpack joins a growing list of crypto firms competing for dominance in the European market. Bitstamp, Coinbase, and Netherlands-based D2X have already acquired MiFID II licenses, with D2X planning to introduce USD-denominated futures and options soon. Despite this competition, Backpack’s acquisition of FTX EU provides a unique opportunity to establish itself as a market leader in regulated derivatives.
The firm also plans to build on its founders’ experience in the Solana ecosystem, where they previously launched a successful wallet and NFT business. Backpack raised $17 million in funding last year, underlining investor confidence in its vision and capabilities.
What’s Next for Backpack?
While perpetual futures are a priority, Backpack’s roadmap includes a diverse range of products to serve Europe’s growing appetite for regulated crypto trading. However, Ferrante noted that not all offerings would be available immediately, with some products expected to roll out later in 2025.
With the crypto derivatives market largely dominated by offshore exchanges like Deribit, Backpack’s regulated approach offers a compelling alternative. The firm’s entry could mark a significant shift in market dynamics, driving more institutional and retail investors toward compliant trading platforms.
