As Brazil bans Binance crypto derivative offerings, the exchange is looking at another setback. In its official statement, the Securities and Exchange Commission (SEC) of Brazil mentioned that Binance could not offer crypto derivative products as the exchange is not registered with the authorities as a securities intermediary.
The official order further clarifies that the derivative contracts are classified as securities under Brazilian law. Therefore, Brazil bans Binance derivatives saying it must hold a license as a securities intermediary in order to undertake such trading activity. Lately, Binance has facing been facing regulatory concerns in many countries.
Traders affected as Brazil bans Binance derivative offerings
The SEC order mentions that the firm Binance Futures is offering various products to Brazilians that come under the category of derivatives. The official website does not have any mention of meeting the derivative intermediation regulations. Therefore, the order concludes that such services are banned since the company has no clearance to act as a securities intermediary.
As Brazil bans Binance futures, the company has not issued any official statement in response to the SEC order. The ban would directly affect Binance traders dealing in derivatives products.
Despite global setbacks, Binance is still in business
As per the orders of closure of Binance derivatives, the company must also instantly stop advertising such derivative products. All such soliciting must be stopped on various platforms, including online social media channels. Failure to comply with the directions would attract a hefty penalty of $188 per day.
Interestingly, the SEC order only relates to banning derivatives. There is no mention of the spot trading operations currently on offer by Binance. Though Brazil bans Binance derivatives, its other operations are not touched upon. Whether the ban also extends to other related offerings or not is not clarified. The CVM order primarily appears to catch only the crypto derivatives products only.