Australian investors have been left unable to withdraw their funds after the spectacular collapse this week of cryptocurrency exchange FTX.

The company's Australian entities have now gone into voluntary administration, and customers have been advised not to deposit funds or trade on the platform.

One of the world's largest exchanges, FTX's downward spiral this week has been dramatic even by the standards of the notoriously treacherous cryptocurrency industry.

Its high profile is due in part to the shaggy celebrity of founder Sam Bankman-Fried — as well as its sponsorship of events such as the men's T20 World Cup, currently playing out in Australia, and stunts like buying the naming rights to the Miami Heat's stadium.

But recent developments have removed its shine.

Last week, cryptocurrency news outlet CoinDesk reported on a leaked financial document claiming Mr Bankman-Fried's trading firm Alameda Research was backed by a significant amount of a cryptocurrency known as FTT, sold by his own FTX exchange.

The potential relationship between FTX and Alameda troubled the market, and founder of rival exchange Binance, Changpeng Zhao — who has denied any "master plan" involvement in the collapse — then announced his company would dump its FTT tokens.

This set off the equivalent of a bank run and investors bailed, reportedly pulling out of FTX to the tune of more than $US6 billion in 72 hours.

As FTX began to collapse, Mr Zhao announced that his own company had entered into an agreement to buy FTX.com — FTX's non-US arm. But on Thursday, the deal was no longer on the table.

Binance later posted on Twitter that the acquisition would not go ahead due to "corporate due diligence", putting the money of FTX investors at risk.

Lisa Wade, chief executive of investment firm DigitalX, said her team had sold out the company's holdings of FTT tokens earlier this week after seeing some worrying signals about Mr Bankman-Fried's empire.

At this point, she sees the story as the downfall of a young entrepreneur who began to "believe their own hype.

"If you picked a person that was the darling of the market, then it would be him," she said, referring to Mr Bankman-Fried.

"Young entrepreneurs have blind spots and blow up their start-ups every day."

Australian investors in the dark

Australians who have money tied up in the exchange have told the ABC their situation seems shaky.

A red banner across the top of the website on Friday told customers the site was unable to process withdrawals and "strongly" advised against depositing.

One investor in Melbourne said he had tried to withdraw a small amount of another cryptocurrency called AVAX from FTX earlier this week, but was told the transaction would take 24 hours. It never arrived.

Iggy, a trader in Perth, said he could see his balance of about $50,000 on the site but could not get it out.

"It's a fair amount of money that I cannot access right now," he said.

"As a trader I'm just moving on from it, writing it off.

"But for someone else, this would be the end of the line for them."