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Binance Australia in hot water with regulator over derivatives trading

Binance Australia in hot water with regulator over derivatives trading

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TL;DR

  • Binance Australia Derivatives sent an unexpected notification to some users informing them that their accounts were being immediately closed due to misclassifying some users as “wholesale clients.”
  • Binance has reaffirmed its commitment to abiding by Australian laws and regulations.

On February 23, Binance Australia Derivatives sent an unexpected notification to some users informing them that their accounts were being immediately closed due to misclassifying some users as “wholesale clients.” This news sparked an outcry from users on social media, prompting the Australian Securities and Investments Commission (ASIC) to launch a “targeted review” of Binance’s local derivatives operations. The review will assess the firm’s classification of retail and wholesale clients, according to a spokesperson for the regulator on February 24.

According to an ASIC spokesperson, ASIC is currently reviewing Binance’s classification of retail and wholesale clients. Following Binance’s overnight social media posts acknowledging an incorrect classification of Australian consumers as wholesale investors, ASIC noted that Binance has not yet reported the matter to ASIC under its Australian Financial Services Licence obligations.

Binance reported that 500 users were impacted by the remediation process shortly after the first posts went out.

Binance has reaffirmed its commitment to abiding by Australian laws and regulations. CEO Changpeng CZ Zhao took to Twitter to reassure customers that any losses incurred would be compensated and to ignore the Fear, Uncertainty, and Doubt (FUD). The exchange is currently exploring the possibility of reopening futures trading in the country in the near future.

The cryptocurrency exchange, currently the largest in the world, has been vocal in its commitment to meeting the regulatory requirements of its local operations.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

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Damilola Lawrence

Damilola is a crypto enthusiast, content writer, and journalist. When he is not writing, he spends most of his time reading and keeping tabs on exciting projects in the blockchain space. He also studies the ramifications of Web3 and blockchain development to have a stake in the future economy.

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