The Australian Securities and Investment Commission (ASIC) has revoked Binance Australian Derivative after a focused investigation into the company’s activities.
According to the announcement made on April 6 by the securities regulator:
“Today, ASIC revoked Oztures Trading Pty Limited, doing business as Binance Australia Derivativesauthorization ,’s to provide Australian financial services.”
Beginning on April 14, customers of Binance Australia Derivatives will not be able to add to their derivatives holdings or create new positions on the platform due to the license termination. Although Binance is anticipated to liquidate any remaining open positions on April 21, the business will also ask customers to close any existing derivatives positions before that date.
Although Binance derevatives cancelation has no effect on the compay’s continued memebership of the Australian Financial Complaint Authority until the end of April 8, 2024.
ASIC noted in the statement that the US Commodities Futures Trading Commission is presently suing the worldwide Binance exchange and its CEO, Changpeng “CZ” Zhao. The regulator mentioned a number of warnings and investigations against Binance that had been launched by international regulators in 2021, as well as the fact that different Binance group firms had been the target of other regulatory warnings and action globally.
According to a spokeswoman for Binance, the company recently engaged with ASIC and decided to take a “more focused strategy” in Australia by closing Binance Australia Derivatives.
“Australians can continue to use our spot exchange product with no problems. Over 100 users are still active on Binance Australia Derivatives, and we have contacted them to let them know that the service is being wound down.”
The announcement follows abrupt notices from Binance Australia Derivatives to its subscribers in late February informing them that it was beginning to terminate specific derivatives positions and accounts.
The company reportedly claimed that it was barring users who didn’t match the standards to be wholesale investors, citing investor categorization compliance. Following that, local officials opened an investigation with the goal of doing a “targeted evaluation” of Binance’s local derivatives business.
Australian traders who have been using Binance Australia Derivatives for their trading activities will need to find alternative platforms for derivatives trading, which could be a challenge, especially for those who have been using Binance for a long time. The revocation of the license could lead to disruptions in the trading activities of Australian traders, which could affect their profitability and financial stability.
We are yet to see other challenges to be faced by Binance. However, this latest development shows that there is more going on for Binance that is yet to unfold.
If development like this persists, Binance may loose trust of traders an investors and this might lead to investors moving their money somewhere else they trust with a reputation.
Keep your fingers crossed as we bring you latest updates in the crypto industry.
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