Australian Regulators Cancel Binance’s Derivatives License

Sahana Kiran
Source – Unsplash

Lately, Binance has been swimming a lot in troubled waters. Looks like these worries continue to haunt the world’s largest exchange. Bad news spanned all the way from the down under this time. Earlier today, an Australian regulator canceled Binance Australia’s derivatives license. However, this revocation was requested by the exchange itself.

According to a recent press release, Binance will no longer be allowed to offer derivatives services to its Australian clients. The Australian Securities and Investments Commission [ASIC] instructed the exchange to close all of its clients’ derivatives positions before April 21. However, from April 14, users will not be allowed to increase their current derivatives positions or even open new ones on the exchange. This move is part of a “targeted review of Binance financial services business in Australia.” It also includes the sorting of both its wholesale as well as retail clients. ASIC Chair Joe Longo addressed this and stated,

“It is critically important that AFS licensees classify retail and wholesale clients in accordance with the law. 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..”

Additionally, he revealed that similar reviews are underway and majorly focus on “the extent of consumer harms.”

Binance reacts

As mentioned earlier, Binance requested the revocation of its license on April 5th. Further elaborating on the process going forward, the exchange wrote,

“We have reached out to impacted users to notify them of the winding down process. We apologize for any inconvenience this may cause and we will be closely monitoring the process to ensure it is as seamless as possible.”

Furthermore, the exchange noted that it intends to take a more “focused approach” in the region. Binance also confirmed that it would continue building its locally registered spot exchange.