CySEC Lifts Trek Labs License Suspension After €200,000 Penalty

The Cyprus Securities and Exchange Commission (CySEC) has officially lifted the suspension of Trek Labs Europe Ltd’s investment firm license, allowing the company—formerly known as FTX (EU) Ltd—to resume operations. This decision marks a significant step in the company's efforts to rebuild and regain regulatory compliance following the collapse of its parent company, FTX.

FTX EU, which operated out of Cyprus to provide services across the European Union, was placed into administration after the implosion of FTX. The unit was later rebranded as Trek Labs in an attempt to distance itself from the scandal and seek regulatory rehabilitation. The recent move by CySEC reverses a suspension that had been in place since November 2022, when the regulator first raised concerns about the company's operations.

According to CySEC, its warning came in late 2024, but Trek Labs, operating under CIF license number 273/15, has since addressed the issues. With its license back in good standing, the firm is now authorized to carry out its investment activities under CySEC oversight. This development follows an investigation into the company’s operations between March and November 2022, a period that predates its rebranding and change in ownership structure.

The probe found that the investment firm may have fallen short on several fronts, including organizational requirements, client communication standards, and procedures for assessing whether its products were appropriate for retail clients. CySEC cited possible violations of three key sections under the country’s Investment Services and Activities and Regulated Markets Law of 2017. These included shortcomings in governance arrangements, failure to provide clients with fair and clear information, and inadequate investor suitability checks.

CySEC imposed a €200,000 settlement on Trek Labs last month over a string of regulatory breaches during its time under the collapsed crypto giant’s umbrella. The penalty, which the company has already paid in full, closes this chapter of the regulator’s scrutiny without any formal admission of wrongdoing. This move comes nearly two months after crypto exchange Backpack began processing fund claims for former users of FTX EU, offering a path to recover euro balances frozen since the collapse of Sam Bankman-Fried’s empire.

Backpack confirmed that users of the now-defunct FTX EU can start reclaiming their funds via its platform, provided they complete Know Your Customer (KYC) verification. The move follows Backpack’s acquisition of FTX EU in January 2025 to revive the platform under new leadership and returning locked user funds. To begin the process, FTX EU users must open a Backpack account and ensure that their personal information matches exactly with the details submitted to FTX EU during the original registration. Backpack warned that mismatched KYC information could delay fund access. Users facing such issues are advised to contact Backpack support to manually update their records.

Not every user from the European Union qualifies for the fund recovery process. The eligibility hinges on a key date: March 7, 2022. Users who signed up to FTX on or after that date may fall under FTX EU’s umbrella, depending on whether they registered via the EU-specific portal. Those who joined before that date are likely customers of FTX International and must pursue a separate claims process. Backpack clarified that some exceptions exist, and EU-based users should double-check the FTX terms of service to confirm their status.

Despite the legal wrangling, Backpack CEO Armani Ferrante pushed ahead with fund recovery, stating in January that returning FTX EU customer funds would be the top priority — and the fastest way to restore trust. This development underscores the ongoing efforts to rebuild trust and regulatory compliance in the aftermath of the FTX collapse, with Trek Labs now poised to resume its investment activities under CySEC oversight.