Binance Australia's Derivatives License Revocation - Shockwaves Crypto Market
Some accounts and positions of derivatives were closed by Binance Australia’s Derivatives in February. In the country, Binance operations were targeted and reviewed, and after that, ASIC (Australia Securities and investment commission canceled the license of Binance Australia derivatives.
On April 6, the securities regulator announced,
“The license issued by Oztures Trading pty ltd trading to Australian financial services was canceled by ASIC.”
After the cancellation of the license, Australian derivatives clients aren’t allowed to increase or open any new derivatives positions. Every client of Australia derivatives is strictly asked to follow the order after April 14.
Key Takeaways:
- Binance Australia Derivatives lost its license due to compliance issues with wholesale and retail clients.
- No new derivatives positions can be opened, and existing positions must be closed by April 21.
- Binance Australia’s spot trading services are still available, but the derivatives business has been wound down.
- Binance remains a member of the Financial Complaints Authority until April 8, 2024.
- ASIC’s cancellation of Binance’s license is part of a more focused approach after engaging with the company.
Furthermore, every user of Binance Australia’s Derivatives is ordered to close any existing derivatives positions because the company Binance can close all their remaining open position accounts on April 21. The cancellation terms include a provision stating no cancellation affects the binance requirements.
They are still a member of the financial complaints authority till April 8, 2024. In Australia, a targeted review of the Binance financial services business was conducted by Australian securities regulator wholesale clients, and the classification of retail compliances was also included.
As the review was related to compliance with the wholesale clients and classification of retail, the ASIC chair Jeo Longo said:
“Retail clients trading in crypto derivatives are afforded important rights and consumer protections under financial services laws in Australia, including access to external dispute resolution through the Australian Financial Complaints Authority.”
Moreover, ASIC passed a statement stating that the United States Commodity futures trading commission global Binance Exchange and its CEO changing “CZ,” Zao is facing a lawsuit recently.
However, the Binance Australia derivatives business reviewed by the regulator noted that other regulatory warnings and actions worldwide were subject to finance group entities. In 2021, global regulators initiated a series of investigations and warnings against Binance.
After engaging Binance with ASIC, they decided to get a more focused approach. And this can only be done after closing the Binance Australia derivatives down, said the spokesperson.
The representative emphasized that for Australian residents of Binance, spot trading should still be available. They also state that:
“Australians can continue to enjoy the use of our spot exchange product. There are a small number of remaining users on the Binance Australia Derivatives license, approximately 100, and we have reached out to notify them of the winding down process.”
Abrupt notifications were sent to Binance Australia derivatives in late February, and the news was released right after, which stated that Binance would close certain derivatives accounts and positions.