Binance's derivatives license has been revoked by ASIC, affecting the crypto exchange's operations in Australia.
The Australian Securities and Investment Commission (ASIC) has decided to cancel Binance's derivatives license, which has allowed the crypto exchange to offer derivatives services in Australia since July 2022. The license cancellation comes in response to a request submitted by Binance and takes effect immediately.
According to ASIC's directive, all derivatives dealings on the platform must cease on or before April 14. Derivatives traders are required to close all positions held before April 21. Despite the license cancellation, Binance Australia will remain a member of the Australian Financial Complaints Authority (AFCA) until April 4, 2024.
ASIC has been closely monitoring the financial operations of the exchange within the country, particularly focusing on the processes of classifying wholesale and retail clients. ASIC Chair, Joe Longo, emphasized that the assessment aimed to protect retail and wholesale clients under the country's financial services laws.
Longo also highlighted , have faced with authorities in recent years. The company is currently involved in a lawsuit with the United States Commodity Futures Trading Commission (CFTC) and has received warnings from other regulators, particularly in 2021.
The commission's decision may be linked to the notifications Binance sent its users in late February 2023, announcing the closure of some derivatives positions and accounts due to investor classification compliance. sought to exclude users who didn't meet the requirements to be classified as wholesale investors. This move prompted local regulators to launch investigations into the exchange's derivatives operations.
In response to ASIC's decision, Binance has opted to shift its focus to other services and discontinue Binance Australia Derivatives. However, the exchange will continue to offer spot trading for Australian citizens. This wasn't the case for its , which halted deposits and withdrawals due to bank policies stifling its operations.
Binance recently , with the exchange still facing .
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.